I am writing this out of frustration with the PayPal process. If you can avoid it, NEVER use PayPal as your payment processing. They require you to give way too much information to receive payments from customers. And that’s not all.

First of all they charge a processing fee which takes a certain percentage from every transaction. To issue a check they charge another $1.50. It doesn’t seem like a lot but imagine the hundreds of thousands of transactions that are being processed every day and you can see how they afford the phone bank they employ to answer questions from frustrated users like us! But that’s not all!

Even after you verify your bank account to automatically transfer the funds into (to avoid the extra check charge), it takes anywhere from 4-6 business days to move the money. Although they have already received the money from your customer, they make you wait almost a week before you receive your funds. Why would that be?

If you think about it the $450 sits in their account for a week earning interest. Doesn’t sound like much but when you multiply an average of $1000 per transaction times the tens to hundreds of thousands of transactions they must see in a day, it adds up. It’s almost like the govenment’s withholding scam!

Look, I am not against people earning a living, but wouldn’t it be just as easy for someone to pay by check? It would be  lot less expensive too!

- Mick Orton

Editorial: We have been in the San Francisco real estate market for over 35 years, and there are very few people who are involved who have not heard of Janis Stone and SFResidence. However, Google the phrase “San Francisco real estate” and see where our website comes up.

I understand that big corporations like Pacific Union, Coldwell Banker and other brokerages would come up high in the search rankings. But… Boston Globe in the top 10? One news story and it ends up on the first page? How does that serve the people who are looking for information on San Francisco and its real estate market? It doesn’t.

Our blog is one of the best places to find out about changing property laws and real estate reports that are not specific to our business. Yet we continually end up on the second page of the search results… sometimes even lower.

Brokerages have much money to invest in advertising, but how is that helping the general public find the information they need? I have heard that the search results are manipulated by Google based on money, politics, etc.. What ever happened to keeping  your audience in mind? I guess money talks. But you know what? Yahoo is even WORSE!

- Mick Orton
Marketing Manager – SFResidence

We have nothing against the Daily Pundit blog but it has two listings in the top 30 on Google results when you plug in the phrase “San Francisco Real Estate”. Is that really something the Google user base is looking for? It is an opinion blog, not somewhere people go to find real estate? How does Google justify this?

SFResidence used to be in the top 20 and often in the top ten in this same search but now we have fallen to the 5th page at 41 (that’s based on today’s search). We have a lot of resources on our website and strive to make it full of pertinent San Francisco information, yet the Daily Pundit out ranks us. It may sound like sour grapes (and it probably is to some degree) but in terms of relevance, we beat them out hands down as well as other listings that show up in the search results.

Bottom line? You may have to dig deep if you use Google. They don’t seem to have their customer’s best interest at heart.

- Mick Orton

The Stimulus Package has passed, and now we shall what effect this will have on our economy.  I personally want people to start being proactive. I ultimately believe it is up to each and every individual to be productive, and this is what will ultimately bring us out of this situation. 

This is one of the best times to buy property in San Francisco that I have seen in many years.  I have called what happened in September and October our “economic earthquake” and it had a similar effect on our market that the 1989 earthquake had on our market. Our prices have dropped and the inventory is still low.  More properties are coming on the market but in the established areas there is still a need for good properties.

I have noticed in the last couple of weeks increased activity at every price point.  Several properties priced above $3 million have received multiple offers and gone into escrow. This is great news.  For months nothing was sold at that price point.  The market under that price point is also moving.  This usually shows us a bottom has been found by the buyers.  They are seeing value.  The interest rates are low and the prices are low….what could be better for buyers???

I’d love to hear your comments. Write to Janis@SFResidence.com and let me know your thoughts.

- Janis Stone

Referring to today’s market update by Coldwell Banker’s President of San Francisco Bay Area, Rick Turley, we respectfully disagree.

The recent $700 billion bailout of companies that had no business lending to some people in the first place is a bad deal for everyone. True, the National Association of Realtors supported the bill, but only because it helps (in the short term) the real estate industry. But we fundamentally disagree about what government is supposed to do.

Apparently congress and the president of the United States seem to think that government is supposed to INSURE that everyone succeeds, even when they make bad decisions. Not so fast. Real life rewards the winners and punishes the losers, and people should learn from their mistakes. This bill does just the opposite.

With pressure from President Clinton, Fannie and Feddie both took on home loans they knew could never be paid back. Some were and ZERO interest and ZERO money down! In fact, some of the loans were to people who did not even have a job. Now the rest of us have to pay for that decision? I guess technically since we had to borrow from a budget that is already in a significant deficit, NOBODY is actually having to pay for it, but you get our point.

Bottom line is this. Real estate is risky in the short term. For years lenders had in place guidelines upon which to accept or deny people looking for credit to buy a home. It worked well. Suddenly government decides that everyone is entitled to the American dream of home ownership and look where we are! Now as a result of the bailout, the stock markets are suffering… and not just us, but everywhere.

It’s time to take a look at who orchestrated this mess and do something about it. Sure, George Bush is the president, but we also have a lot of Democrats in the house and senate who are just as culpable. In fact, watch the debates tonight and see if John McCain doesn’t name names. Afterall, he was sounding the warning bells about Fannie and Freddie several years ago.

- Janis Stone & Mick Orton

To me it makes sense. I put myself in the situation where I’ve owned my house for quite a few years. I am retired and have to live on Social (in)Security. What better way to increase the quality at which I can live by pulling money out of my house?

In an Associated Press story yesterday in the San Francisco Chronicle, they talked about the ads featuring James Garner pushing reverse mortgages as an alternative to provide seniors age 62 or older an influx of cash. (Perhaps if Ed McMahon had done this…)

As with any type of investment there are things to watch out for, but overall, the plan sounds reasonable to me. Again, from my point of view, money now versus money later when I am dead makes about as much sense as “death” insurance. This is for the people I leave behind, not for myself. So why not “borrow” from the biggest asset I own to make my retiring years a little cushier? Makes perfect sense to me… Just be sure to structure it so that the money doesn’t run out before I pass on!

- Mick Orton

This is an opinion article with regard to the current housing situation.

As you know if you listen to the news, they are really hyping the mortgage “crisis”. Of course they thrive on bad news anyway, so it is not surprising that they go to places where foreclosures are plentiful.

Why has this not happened in San Francisco? Why does the market continue to chug along at a healthy rate? In my opinion, it’s the fact that there’s not a lot of new construction, and there has not been a lot of over-building.

Usually I am very critical of San Francisco government which is heavy-handed toward builders. But in this case, it seems to have worked in the favor of real estate sales. Again, it’s supply versus demand and, because there is not a lot of new supply and the demand remains high, prices stay up… at least for now.

Without a crystal ball, it is impossible to tell what the future holds. Some experts predict the worst will be over by spring when inventories nationally level out; others say we won’t recover on a national level until mid-2009. As far as San Francisco goes, who can say? But so far, so good.

Look at February numbers on our website. This is usually a very slow month for us, but sales were strong and selling prices were slightly over 100% of the listing prices.

- Mick Orton
Marketing Director

As we reported earlier, the San Francisco Association of Realtors plans to discontinue the public side of its website. However, you will always be able to search available listings FREE from the SFResidence website.

- Mick Orton

===================================
With REALTOR® members’ interests in mind and after thoughtful consideration, the board of directors of the San Francisco Association of REALTORS® (SFAR) has voted to remove public access to MLS listing information on the Association-operated website, www.sfarmls.com. The action is being taken to drive traffic now received by sfarmls.com to broker websites in an effort to establish REALTORS® as the first point of contact for consumers looking for real property in San Francisco and the Northern Peninsula. The action will become effective on January 1, 2007.

In the past several years there has been an alarming movement of consumers from broker websites to the public MLS site. To make the site less appealing to consumers but to preserve its usefulness as a source of listing information, the Association attempted to delay posting new listings to the site by one week. Unfortunately, Rapattoni Corporation, operator of the site, could not accommodate the request.

Leading firms in the city have reported that in surveys of buyers they have represented, an overwhelming majority found the property they ultimately purchased not on the firm’s website but on sfarmls.com.

Today, under the Association’s IDX (internet data exchange) policy, it is possible for any broker participating in SFARMLS to duplicate the listing information currently found on sfarmls.com on his or her own website. The policy is set forth in SFARMLS’ Rules and Regulations at Section 12.16.

The Association has approved several vendors that can set up an IDX site for any broker participating in SFARMLS. The cost is not significant. But if having a website with MLS information does not appeal to a broker, realtor.com, the site operated by the National Association of REALTORS®, will continue to display listing information from San Francisco and the Northern Peninsula, as well as other areas around the United States.

Set forth below are a set of questions and answers that members may find useful in understanding how the discontinuance of public access to sfarmls.com will affect them.
* * * * *
Q: When did SFAR begin operating a public MLS website?
A: When SFAR launched Rapattoni MLS in July of 2002, a public MLS website was included in the package. Although many of the brokers in SFARMLS were already displaying MLS listing information on their websites under the Association’s IDX policy, many were not so the Association agreed to maintain a public site until there were a greater number of broker websites with listing information. Now that nearly all brokers in SFARMLS have their own IDX sites, there is no longer a need to provide this service.

Q: What is IDX?
A: IDX stands for Internet Data Exchange, and is a standard developed by NAR for brokers (and MLSs) to display listing information on their websites to the public. IDX is intended to be an advertising vehicle for brokers. IDX information includes only publicly-viewable fields, and does not include any “agent-only” information such as agent remarks, showing information, such as lockbox codes, days on market, or contact information. Not all listings in the MLS are available in IDX feeds.

Q: Why don’t we just keep the public MLS website up? My clients really like it!
A: There are two main reasons for discontinuing public access to sfarmls.com: First, there is the reason stated above. Second, there is the recognition that the listing information belongs to the broker, not to SFARMLS, and that many (if not most) brokers feel that the public site detracts from their efforts to attract consumers to their own sites. Every broker who uses IDX has the EXACT SAME INFORMATION on their site as SFARMLS currently has on its public site.

Q: I like the idea of a trusted, neutral source of information for the consumer. Where do I send my clients now?
A: There are strict rules preventing brokers from indiscriminately removing individual listings from the IDX feed they get for their websites. Familiarize yourself with the rules governing IDX display of listing information, and you can easily educate your clients. Your clients can receive all of the listings they have come to expect from your broker website. Alternatively, listing information is available at www.realtor.com.

Q: Where do my clients go now to see all of the listings in the MLS?
A: It is a common misconception that the public side of www.sfarmls.com contains all of the listings in SFARMLS. Your clients have never had access to all of the listings on SFARMLS’ publicly accessible website.

Some brokers have internet applications for their clients where, after logging onto a portal, the client has access to all of the listings. These applications are available from third-party vendors for brokers and agents who have not developed the internet applications themselves. To use these applications to access the full listing inventory, the consumer needs to have a relationship with the broker or agent using the application. Taking down the public access to www.sfarmls.com will not change this policy.

Q: I have the Rapattoni search framed on my broker or agent website. Will this be turned off, too?
A: No. The only thing that will change is the elimination of public access to www.sfarmls.com. The same search window will continue to be available as a framed solution for both brokers and agents.

Q: I’m a broker without a company website. What are my options for getting a site that displays IDX listing information?
A: See the attached list for the names of vendors who can provide brokers with a basic website that displays IDX listing information.

Q: What are some of the benefits of removing the public MLS site?
A: First, as mentioned above, the goal is to drive traffic that currently is going to www.sfarmls.com back to broker and agent websites. This will result in many more eyeballs on broker and agent brands and more exposure for them and the services they offer. SFARMLS’ public MLS site really does not do anything to serve brokers and agents other than to provide free access to the listing information that brokers and agents have worked so hard to procure.Second, the MLS (and the display of listing information) was not designed for the public. The purpose of the MLS is clearly stated in the MLS rules: “…a facility for the orderly correlation and dissemination of listing information among the participants so that they may better serve their clients, customers, and the public.” The connection with the public should come from broker and agent websites, which are designed to display the information in a consumer-friendly format. Remember, this is the same information that is currently available at sfarmls.com. There are no fewer listings on a broker’s site than there are currently on the public SFARMLS site.

Q: But the public site gave my listings additional exposure, no?
A: The public will continue to seek listing information on the internet, and the
consumer will still find a broker and agent’s listings no matter what broker or agent site they look at, provided they have marked “yes” in the IDX field when uploading the listing to SFARMLS.

Q: What do I tell my clients? Where can they search the MLS?
A: Just send them to your broker or agent website. And, if your broker site does not currently contain IDX listing information, contact (or have your broker contact, if you are an agent) one of the vendors already approved by the Association. Having IDX information on your site is not only a chance to connect with your clients, but a chance to build your brand by reminding your clients of the services you provide.

Q: When will the public MLS site be taken down?
A: By motion of the SFAR Board of Directors, the public site will come down on January 1, 2007.

Q: What will happen when a visitor clicks on www.sfarmls.com after January 1, 2007?
A: The user will see the following message:
“Technologies surrounding the management of listing information have made public access to the information through the Association obsolete. The information is now available on many of the websites operated by broker participants of SFARMLS.
“To find a site that suits your needs, go to www.sfrealtors.com and use the ‘Find a REALTOR®’ tool.”Please accept our apologies for any inconvenience that you may encounter in transitioning to these websites.”

- San Francisco Association of Realtors

We talked about this “churning” issue in our September 23 post. As stated previously, articles have appeared on other blogs such as SocketSite from people who are disgruntled at Realtors for manipulating statistics by withdrawing properties and relisting at a lower listing price to avoid the “reduced” stigma. From the Realtor’s point of view, this does the best service for their clients who want to get the property sold for the best price. Using this technique gives the property “new” exposure to the real estate community and does not give the impression that “there is something wrong” with it. After all, isn’t this the Realtors’ job? They are in the business of selling properties, not generating statistics!

Now the California Association of Realtors is addressing these issues by presenting a Q&A on their website. They say:

“With the changing market, real estate practitioners representing sellers face new challenges marketing their listings. Some have engaged in the practice of relisting or “churning” a listing. The following legal article addresses this subject and some of the related problems and issues.

- Copyright© 2006 CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.). Permission is granted to C.A.R. members only to reprint and use this material for non-commercial purposes provided credit is given to the C.A.R. Legal Department. Other reproduction or use is strictly prohibited without the express written permission of the C.A.R. Legal Department. All rights reserved.

The following is an editorial.

If you enjoy getting frequent market updates, go to MarketWatch from Dow Jones and sign up for their free e-mail newsletter update. You will get anywhere from 2-3 updates a morning about everything from interest rate updates to housing reports. The reports can be very informative or confusing or even crazy making, depending on how you read them!

My question is this; how often are these economists really right? Their track record is never given as to how often they are right in their predictions. For example, this morning ‘s report was “U.S. NEW-HOME SALES SHOW UNEXPECTED AUGUST PICKUP”. Unexpected is the key word here. Google information on housing reports and you will see that everyone recently has been banking on a bursting housing market bubble. Another report I got today was “U.S. durable-goods orders unexpectedly fall 0.5%“. Another unexpectedly! So whose expectations were these, theirs or ours?

My point is that the economy is so big and complex that nobody can really predict with any accuracy what is going to go on. And this seems to be what news has become; not what happened and when it happened, but rather predicting what is going to happen! It appears to be the new phenomenon. Take a look at news headlines and you will see that this often is the case anymore.

As Donald Trump points out, lots of people are out there telling you how to make money in real estate, but how many of them are actually doing it? He makes a good point. Many of these people make their money selling books and tapes or giving lectures telling other people how to make money buying and selling real estate, but how many of them have really done it??? The same question should be put to the experts. Let’s see their credentials BEFORE they are allowed to tell us what is or is not going to happen!

Has life become so uncertain that we need to have someone look at their crystal ball and tell us what the future will bring before we get out of bed in the morning???

Look at our past posts and you will see that we are bullish on real estate for long term investment and building wealth. These up and down changes are just market fluctuations that happen all the time. If we knew what caused them with any certainty then we would probably be consultants to the Wall Street Journal or some other publication and do better than the so-called “experts” they quote in their columns. In fact, moisten a finger and put it in the air yourself to make a prediction… you’ll probably do better than these guys!

In closing, make your own reality. Be positive about our economy and invest for your future. Stick to the basics, watch the people who are making money and do what they do. Chances are you will make out just fine.

- Mick Orton