How is ZipRealty still in business?

In my opinion, ZipRealty is an enigma.  They went public in 2004 and their current CEO, Patrick Lashinsky, took the helm in 2007.  The company has rarely turned a yearly profit (only two years in its eleven year history based on my count) and in the most recent quarter, ZipRealty lost another $2.1M.  All told the company has lost tens of millions of dollars.

Yet last year, the CEO Mr. Lashinsky was given a raise from $350,000 to $400,000 per year.  And earlier this year, Mr. Lashinsky was granted a bonus of over $122,000 and 3,400 shares of stock.  Pretty nice gig if you can get it.

How did Mr. Lashinsky become CEO of a publicly traded real estate company? He rose through the ranks at ZipRealty and was formerly a marketing manager for General Mills, according to his Linked-in profile. That is the last job that Mr. Lashinsky had before he started at ZipRealty, where he worked on Go-Gurt Yogurt and ChexMix, according to the ZipRealty website.

How is it that Mr. Lashinsky continues to get raises and bonuses while his company loses money?  I’m not sure.  Good question for investors to ask the board of directors.

In my opinion, what’s sad is that the entire management team seems to be getting bonuses while the company loses money, according to ZipRealty’s SEC filings.  It reminds me of the uproar over bank executive bonuses.  I wonder how many ZipRealty customers and employees realize where their dollars are going?

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

Last week I had the pleasure of speaking about Yigdigs with Jonas Lamis from Tech Ranch Austin. The Tech Ranch is a community of Austin entrepreneurs that share ideas, barter services with each other, and work together side-by-side at the ranch.  It’s one of the few places in Austin that entrepreneurial, like-minded individuals can co-locate and network with each other.

One of the best things I like about Tech Ranch Austin is the group has many regularly scheduled events such as campfires, brown bag lunches, and classes specifically designed to help you network and learn something about startups – venture capital, product marketing, sales… the list goes on.  You can check them out here.

Watch the video of the Yigdigs  interview on the TRA site, Jonas’ blog, or directly on Youtube.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

If you are not sure what title and escrow are in the home closing process, don’t be alarmed.  Many homeowners get confused on what exactly these terms mean.

A title policy is an insurance policy on a piece of real estate that insures against the title deeds being incomplete or not properly searched.

A definition of escrow from the Investor Glossary:

“In contract law, escrow is a legal arrangement whereby an asset is held by a third party, called the escrow agent, for delivery from one party to another once certain conditions are met. Escrow is commonly used in high value transactions. Documents, title to real estate, software code, and of course, cash, can all be held in escrow. In real estate, the buyer’s deposit is typically held in escrow until the closing, when title is transferred. The fiduciary duty of the escrow agent is generally to the seller. The importance of picking a trustworthy escrow agent cannot be understated. There have been several cases of attorneys who, while acting as escrow agent for their client, took funds held in escrow.”

That’s a lot of words for saying escrow is basically a safe haven for the money to be held while the home sales process is taking place.   As a For Sale by Owner (FSBO) home seller, working closely with the title company is critical.  Always remember that title companies are your friends – they want to keep the deal on track just as much as you do.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

What to expect in a typical Buyer’s Offer Sales Contract

Do you wonder what to look for in a sales contract when a buyer makes and offer to purchase your home? What’s normal?

Watch this informative tutorial as we step through a completely filled out example of a standard Texas residential real estate sales contract.  Andy Salo interviews Austin, Texas real estate agent Harold McGee.

Download the PDF of the completed sample sales contract here.

You can watch this educational For Sale By Owner video along with others at Yigdigs video tutorial page.

Texas Residential Real Estate Sales Contract Example

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

If you live in Austin and have ever thought about selling your home For Sale By Owner (FSBO), here is your chance to learn how to do it.  Yigdigs will be hosting a free “unconference” at the Iron Cactus North on October 14th at 6pm.  Event details below and at www.forsalebyownergroup.com.

Please RSVP today.  Hope to see you there!

—————————————————————

Event Details:

Please join us for our For Sale By Owner October Meetup where we will discuss current residential real estate trends in the Austin area and the steps involved in selling your home FSBO.

Speakers will include:

Andy Salo – Founder of Yigdigs – a new social-media friendly FSBO and Agent Assisted website.

Rosa and Marco Pando – a local couple that took the leap and are currently selling their home FSBO… and they received an offer on their house the first week!

Harold McGee – Austin real estate agent and owner of Captex Enterprises.

If you ever wanted to learn about FSBO, Flat Fee MLS Realtors, or simply how the Austin real estate market is doing – come and enjoy the discussion.

www.forsalebyownergroup.com

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

Buying a home can be an intimidating process, especially if you are considering buying a home without using a buyer’s agent.  Luckily there are a few easy steps to make the whole process less daunting.  These top five home buying tips will make you more confident and ready to buy either your first, or next, great home.

1)    Get Pre-Approved for a Loan

In any market and especially a tough real estate market, the most important step to take before buying a home is to get pre-approved for a loan from a reputable lender.  It used to be enough to be “pre-qualified” but that isn’t enough anymore.  A home seller will want to know that when you make an offer, obtaining financing won’t be a problem.   Therefore these days submitting a pre-approval letter when you make an offer to the seller is almost considered mandatory.

To get pre-approved, you will need to first choose a mortgage broker or banker.  They will need information from you about your job, credit history, assets and debts.  With this information you will know what amount of money you will need for a down payment and what price range of house you can afford.

To learn the other top five tips for home buyers, keep reading the For Sale By Owner (FSBO) blog on Yigdigs here…

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

A lot of people I have spoken to would love to sell their home themselves, but they are apprehensive about it because they don’t know exactly how to do it.  I agree it can be intimidating – it is your home after all and worth a lot of money.  No one wants to mess it up.

But the best way to overcome fear and uncertainty in anything you do is education.  That’s why I’ve created a free video tutorial series on how to Sell your Home in Seven Easy Steps.  The For Sale by Owner Blueprint is on the video tutorials page of my website, YigDigs.   If you like the videos, please rate them on Youtube.

Feedback on the videos is welcome so please email, tweet, connect, or link to me and let me know what you think.

[youtube=http://www.youtube.com/watch?v=oFFvdvUmyTM&hl=en&fs=1&color1=0x006699&color2=0x54abd6&border=1]

You can check out all of seven of the videos on the Yigdigs Youtube channel.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

Visiting Canada this week I had the opportunity to speak with a family currently selling their home and buying a new one.  The family has bought and sold a house three times in the last five years, so they are a good data point on the recent housing market around Toronto.

It seems that the market in Southern Ontario, just west of Toronto, is getting strong.  The family is looking to trade up so they are selling their current home that they have fixed up for about $210K.  And they believe they have found a better home nearby for about $250K that is both bigger and nicer.  But they searched hard for that house, and after looking at more than 20 homes, they were amazed at what little $250K – $300K could buy.  Lots of homes were run down, seriously outdated, or not well-maintained.

In the States (what Canadians like to call the U.S.), not many home sellers could get away with putting a home on the market that wasn’t in perfect condition.  Most areas in the U.S. are still struggling after a massive downturn.  But in some areas of Toronto, there is a return to bidding wars.  Hopefully this is a leading indicator and the U.S. is not far behind.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

Here’s another bad deal for home buyers.  A couple weeks ago I wrote a post about what I view as an unethical practice, and what should be illegal – a Bonus to Selling Agent (BTSA).  The issue arises because the buyer’s agent will get paid above and beyond the typical 3% commission, presumably to entice them to steer their buyer towards a particular house.  The problem is this violates their fiduciary responsibility to the buyer.  Not to mention will undoubtedly make the home buyer upset if their agent’s recommendation just happens to provide the agent with an extra special pay day, when he/she is supposed to be looking out for the client’s best interest.

This time the example email advertisement is for an existing home, rather than a new home from a builder.  The email  below was sent out today to all real estate agents that do business in the area where the home is located.

Similar to my last post, let’s dissect the email:

• “$5000 Bonus to Buyers Agent!”.   This is a $5,000 Bonus to Selling(Buyer’s) Agent that will be paid to the agent above and beyond the 3% commission.  Based on a sales price of $255,900, multiplied by 3% for the buyer(selling) agent = $7,677, plus an extra $5000 is $12,677.  The offer to a buyer’s agent is “bring me someone to buy this property and the total payout for you will be $12,677.”  That’s an astonishing 5% commission. Not a bad pay day.
• “Great deal @ $66.92 per sq ft. Bring us an offer!” This is the enticement that the buyer’s agent can position to the buyer.  The only problem with this is, that two days before this email went out, the price in the MLS was raised by $5,000.  So if $66.92 seems like a great deal to the buyer, well then, two days ago, they would have received an even better deal.  That was before it became a good deal for their agent instead, and the buyer missed out on a $5K discounted home price.

What further astonishes me is that there are so many laws that protect home buyers from racial, age, sex and all kinds of discrimination, or from steering a buyer to or from particular neighborhoods, or bad lending practices  – but apparently nothing to protect them from agents advertising to greedy buyer’s agents that aren’t looking out for the buyer’s best interests.

Makes you think.

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.

Real estate agents usually get up in arms about For Sale by Owner (FSBO) home sellers.  Almost everything related to FSBOs is debatable.  What percentage of home sellers end up using an agent?  Is the percentage of FSBO sales going up or down?  Who gets a higher sales price for a home – an agent or a FSBO home seller? A lot of real estate agents scoff at the idea that a FSBO seller can do their job well and sell their home at a decent price.

That’s why I applaud this article on Inman news that highlights the recent success of a FSBO home seller.  There will be lots of comments on this article for sure since Inman News subscribers are primarily real estate agents, and talking about FSBO sales is like blood in the water.

The thing I like best about the article is the comment made today byJohn Rowles.  Very prescient.

“Submitted by John Rowles on June 1, 2009 – 4:52am.

If FSBO is 20% of the market now, what will it be when the original latch-key kids, Gens X and Y, become not just the majority of buyers but the majority of sellers as well over the next 10 years?

A lot of us grew up in households with two working parents or one parent, and we are used to doing things for ourselves and finding information and buying things on the Internet is second nature to us.

And if you really want to piss us off, tell us how we need you and how unqualified we are to do your job.

Using an agent is going to be considered a convenience, even a luxury in a seller’s market and foolhardy in a buyer’s market. If nothing else can bring radical change to the entrenched real estate model, demographics eventually will.”

No related posts.

Related posts brought to you by Yet Another Related Posts Plugin.