Monthly Archives: October 2006

Zillow Gets It’s First Complaint

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It was only a matter of time until someone filed the first complaint against Zillow. The National Community Reinvestment Coalition(NCRC) has filed a bogus complaint with the FTC, alleging that Zillow’s property value estimates are misleading, uncool, unsavory, and basically- the devil.

Of course, anyone can file a complaint against anyone, for about any reason, so this may not even go anywhere. Seems to be another example of the “I’m a victim” mentality.

Oh, so Zillow’s estimates aren’t accurate?!?

You mean a 4 second calculation really can’t tell me exactly what my home is worth? Duh…

Zillow is simply a fun tool to look at homes and get a very broad range of a possible value of a property. A professional Realtor will obviously give you a much better idea of a home’s market value, and Zillow knows this and does not claim to take the place of a Realtor. They rely on the real estate agent to advertise on their site, yet many in the industry are so paranoid of what Zillow might do that they whine and complain about everything they do. Why? What’s the big deal with a company giving people a fun way to see a very broad range of value?

I agree with Gregg Swan that this stinks of a shakedown, and the scary part is, many people take this crap seriously.

I say get over it and just focus on giving your clients something they can’t get online.

Building a Defensible Company

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When starting a new company, one of the critical questions an owner, and eventually the investors, need to ask themselves is, “What makes this company defensible against the competition?” or “How will this company survive out there?” Of course, this is in addition to the questions, “What is our unique selling position?”, “What in the world are we doing?” and “Where did all of my money go?”

I came across a blog that referenced Redfin’s blog, where I read Glenn Kelman’s latest post, which also discusses a great post by Guy Kawasaki discussing this topic.

Glenn, who I have met, and really like, makes some great points, and he has some experience with start-ups. 

Some of the things that stuck with me from Glenn’s post include,

“Worry first about building something meaningful for the customer”-

How great is that statement when starting a new company? That could actually be a great company’s mantra- BUILD SOMETHING MEANINGFUL FOR THE CUSTOMER. Any idea how many companies begin that way but end up being something completely different? Isn’t that what entrepreneurship is all about anyway? And isn’t that what Web2.0 is supposed to be about? Building something meaningful for the customer- transparency, better user-interface, quality of experience…?

 “The [big] competitor you imagine sitting on a pile of money and a hundred engineers is sitting in a meeting right now, terrified of making a mistake…”

I’ve worked at a large corporation and I can say from personal experience that large companies take forever to get things done, and beginning a new, untested project is nearly impossible at many of them. By the time they decide to put any effort into an idea, it’s been done for years somewhere else. Realize that Re/Max just put other brokers listing on their website in the last couple months, years after other companies have been doing it- and that’s their big marketing campaign right now- “We have all broker listings” -

“Only a big corporation would be so out-of-the-loop to think that something that’s been done for years is somehow new and innovative. “

Guy Kawasaki, as many Mac users know, has gone from being a pro-Apple activist to the author of eight books and is currently the managing director of Garage Technology Ventures, an angel investment firm he started in the late 1990’s. Guy writes in his blog  about what to say and not to say when a VC or investor asks, “What makes your company defensible?”

First he writes the three things you do not say (his post has explanations about each);

1 “Patents make our business defensible.”

2 “We’re the only guys who can do this.”

3 “[Big-name potential competitor] won’t compete with us; they’ll simply have to buy us out.”

And then gives us the top ten best ways to answer the question;

1 “We know that there are no ‘magic bullets’ that provide defensibility.”

2 “We have filed for patents, but we know that we cannot depend on patents as a major component of defensibility.”

3“We have an x month head start (mention “x month head start” only if x exceeds nine), and what we’re doing is hard. We know we have, at best, a temporary lead. It’s so hard that few established companies would defocus themselves by trying to do what we’re doing.”

4 “We’ve built similar businesses before.”

5 “We’ve amassed a ton of relevant domain expertise because our founders sold to these customers before.”

6 “We used to work at [insert big-name company], so we know it won’t be a competitor. In fact, we quit the company to start this because our management refused to address this lucrative market.”

7 “We don’t know if we’re the only people who can or are doing this, but we’ve already signed up key customers like [insert the biggest names that you truthfully can] to use our product. You’d think they’d know of better solutions if they existed.”

8 “We came to you because we believe that the backing of a firm like yours will dissuade other firms from investing in competitive companies. We also know that you have a world-class Rolodex as well as access to the best talent.”

9 “We expect that there will be competition because we’re not working on a get-rich-quick gimmick. This is a real business that we think is going to be big.”

10 “It’s a race, and we’re going to work like hell to reach escape velocity. That’s the bottom line.”

It’s interesting to hear the perspectives of people on each side of the VC table. My company, BlueRoof.com has not received any angel funding or venture capital, so I have not had to go through the rigors of trying to impress an investor so they’ll give me money.

Any new company is going to have it’s struggles and challenges, whether it’s keeping the investors or clients happy, adding new servers and storage to keep up with your website traffic, or trying to get your fax machines working again- there are some tough days. I’m right in the middle of these days and it’s interesting to hear the industry perspective and compare that with the client perspective.

Last night I went to a great Halloween party hosted by an agent with one the larger brokerages in town. Fun party, with a lot of agents from other brokerages (and some great costumes). It was interesting to hear some of my friends from the industry asking me about my company and what they have made of all the rumors. Some had a pretty good idea, and some had no clue what we are really doing. Everyone was very supportive and I had a lot of “congratulations” and “good for you” comments, but the differing opinions about our business model made me realize how important it is to remember what Glenn says;

“Don’t worry about your competitors”- just “build something meaningful for the customer”-  and then get out there and give it to them.

Trolley Square to be Remodeled

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The Salt Lake Tribune reports that Trolley Square will keep it’s exterior look as it is remodeled, beginning in January. The mall was built in the 1970’s over an old trolley complex, giving it it’s name, and currently has a dark feel with a lot of dead-end hallways and no real identity. With the movie theatres and comedy shows, the mall has strong community support and adds a lot to the area’s culture.

Mark Blancarte, vice president of development for Blake Hunt Ventures, which is partnering with mall owner ScanlanKemperBard in the renovation said better design will add about 20,000 square feet of retail space to the mall, which currently has about 160,000-square-feet.

Trolley Square is not only a state and nationally registered historic site, but sits in a prime location between 600-700 East and 500-600 South. The 97 ft. historic water tower, which was built to hold 50,000 gallons of water, lights up to tell the day’s weather (updated twice daily).

trolleyclear.jpg     Solid blue means clear. 

 trolleycloudy.jpg    Flashing Blue means cloudy.

 trolleyrain.jpg    Solid Red means rain.

 trolleysnow.jpg    Flashing Red means snow.

Blancarte also says there will be some outdoor features, such as water fountains, dining areas, and fireplaces.

About 30% of Trolley Square’s 3 million customers each year are tourists. Renovating such a great landmark will add to Salt Lake’s charm and secure the mall’s future in the area.

Strong Q3 Appreciation for Salt Lake Area

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Third Quarter appreciation remained strong along the entire Wasatch Front. Salt Lake and Utah counties experienced especially strong price increases, with some areas appreciating as much as 40% but most areas keeping in line with a healthy growth rate of around 10-20% year-over-year.

Many home buyers who have waited, trying to find that one perfect house are going to end up paying a lot more. And interest has gone up a bit and could go up more.

The Utah market is definately not as hot as was this summer or even a month ago, mostly because of the seasonal slowdown as the weather gets cooler and we head into the holidays.

Overall, Salt Lake County prices went up 24% to an average of $283,955. Condominiums rose 17% to an average of $168,562.

Utah County saw a 30% increase in prices to an average of $284,619, with condominiums rising 7.5% to $149,190.

Juab County home sales were up 26% to $165,165.

Weber County home sales were up 14%, with prices rising 10% to an average of $168,417.

Davis County reported a price increase of 18% to $236,723, with condos averaging $137,645.

Morgan County sales increased 50%, reflecting 33 homes being sold in the third quarter this year, compared to 22 homes being sold last year. Prices averaged a 62% increase at $326,408.

In Park City, total home sales decreased 27.5%, and condominium sales dropped 62% from last year. Home prices rose by 14% to an average of $826,802 with condo prices rising 32% to an average of $563,065.

Tooele County reported home sales up 10% and prices up22% to $178,116.

Washington County saw the amount of homes sold down 29%, but prices were up 24% to an average of $351,295. Condo prices were up 6% to $194,767.

The Brigham/Tremonton area saw the total number of homes being sold rising more than 20% with the average sales price rising 8% to $148,623.

The Cache/Rich area prices went up 8% to $175,023

In Carbon/Emery areas sales prices rose 24% to an average of $104,653.

In Central Utah prices increased nearly 17% to $128,861.

The Grand/San Juan area had price increases of 16% to $181,653.

Iron County showed prices up 19% to $247,096.

In the Uintah Basin area prices rose 25% to an average of $182,307.

And finally, in Wasatch County, prices rose an incredible 60% over last year to an average of $384,929.

This is a great time to buy a home in Utah because sellers aren’t all pricing their homes as high and there aren’t as many multiple offers to compete with. And right now interest rates are still very low. We anticipate more strong price increases in 2007 with strong job growth and steady population growth.

Top 40 Business Expansion Markets for 2006

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ExpansionManagement.com released it’s findings yesterday for the Top 40 expansion markets in the country. Heading up the list for growth potential this year is New Orleans with its rebuilding opportunities, followed by Tulsa, El Paso, Burningham and Oklahoma City.

Salt Lake City makes the list at #23, showing the Utah real estate market’s continuing strength. And ranks #50 on it’s list of America’s Hottest Cities. That list puts Nashville at the top spot ahead of Phoenix, Atlanta, Dallas and San Antonio.

Describing where the information comes, the company says, “As in years past, the primary sources of data for the Top 40 Real Estate Markets ranking are The National Real Estate Index (NREI), which is produced by Global Real Analytics (www.nrei.info), for the 1st quarter of 2006; Grubb & Ellis’ Office Market Trends and Industrial Market Trends (www.grubb-ellis.com) for the 2nd quarter 2006; and RS Means’ 2006 Construction Cost Index (CCI), a product line of Reed Construction Data (www.rsmeans.com).”

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The Salt Lake area is already seeing historically low unemployment and job growth that is ranked fourth in the nation.

“Jobs — there seems to be a lot of them brewing in this state,” said Mark Knold, senior economist for the Utah Department of Workforce Services. “We’re approaching 5 percent employment growth, combined with the unemployment rate continuing to go lower. It really is very low. . . . This is an economy maxed out, an economy going at full speed, 80 miles an hour on a 70 mile-an-hour highway.”

BlueRoof Real Estate Search Engine

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(Credit Search Engine Watch )  

Patience is No Longer a Virtue…

… it’s a national treasure. In a world of A.D.D. and A.D.H.D. and multi-channel surfing and instant replay and headline news and “feeder”-reprieve and text messaging and go-go-go we are a more efficient populace, but we are definately not patient.

When I search on Google I am told how many gigaseconds it took to find my results as if 0.00013 seconds means something different to me than 0.00045 seconds does. I mean, really- what is the cut-off point between fast and slow?

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If I’m using a website I want it to be fast. And when people use my website they expect it to be fast, I know this because I get emails all the time complaining that it was too slow this time or that it was so fast the last time. Here is an excerpt from an email I received yesterday…

“…but having the best user-interface means less if it’s too slow. My last search took 17 seconds to load 102 houses. I suggest increasing your bandwidth, adding an additional server, or increasing the memory on your current server.”

First of all, we’ve added additional servers and increased our server’s memory several times to keep up with our growing traffic. But as anyone with a website knows, traffic is not a steady stream, it is a tidal wave followed by a trickle. One minute the site may take 17 seconds to load and then next it could take 5 seconds to do the same search.

And on a side note- if you’re on dial-up don’t complain to me about the speed- you wave all rights to complain by having dial-up. That’s like complaining to your car-dealer that your mini-van doesn’t handle well.

But 17 seconds isn’t really that long. Loading over 100 homes, including photos and detail information, and placing them on a map, takes some calculations. Let’s see you do it, smarty pants…

There is a contigency out there that supports Web 1.0 sites, or as I like to call them, “really boring template sites” because they are “fast”. So if I understand this arguement correctly, they would rather have a webpage that looks like a spreadsheet, has no substance, and is clogged with links and meta-tags if it will save you a few seconds of loading time?

Not me- I’d rather have all the goodies and a site with some soul. I like websites that are visually appealing, easy to use, and fun. And although I’m a pretty busy guy, getting all of that is worth an extra five or ten seconds.