Real Estate Investing - Long Term versus Short Term

Up until a year or two ago the Real Estate Market had been doing quite well for sellers for a number of years. Real Estate Prices were steadily climbing across most of the country, and demand from buyers remained strong. This created an ideal market for short term Real Estate Investing, sometimes referred to as "flipping". For investors that know what they are doing, they could often deal in properties with very little of their own money involved, and often make nice profits in a short period of time, mostly from knowing where to go, what to look for, and handling paperwork. Now that the market has shifted so dramaticly, there are - ironicly - more foreclosures available on the market than ever. But there's a problem now with short term investing; you can't be so sure how soon you'll be able to sell it. So if you actually put the title in your name on the deal, be prepared to become a Semi-long term investor for the time being.

For more on this, see the article "How low will real estate go?" by Lacey Rose of Forbes.

Also See the The Real Estate Bloggers for another interesting article about the current real estate market shifts.

The Future of Multiple Listing Services (MLS) and The Internet

In the old days in Real Estate, there were local organizations that realtors congregated to to share their listings. It was a necessity. The Internet was non-existent, and the first computer based systems to share listings were proprietary, and required users to sign up and pay to become members. Thus, the advent of MLS. Many Realtors, especially in rural areas such as where my folks are, still believe that being a member of their local MLS system to get exposure for your listings is a necessity.

I believe that will gradually change, and here are some reasons why:

Cost - MLS Systems charge a significant amount of money, while there are more and more places on the Internet where you can post listings for free - I've mentioned that before and I'll be back later with another articel on my favorite hit list.

Monopoly - May of these MLS systems operate form a business model of "No competition". For example, if you want to deal Real Estate in Hillsdale Michigan youhave to be part of the SWMRIC MLS. Period. Which brings me to my next sticking point. Service. This tends to cause these systems to be less driven to provide better service and site functionality. Some MLS Systems won't allow access to the general public at all, and do things like prevent you from downloading photos.

Discontinuity - With My folks Real Estate Office, they are in a geographic area that requires them to become members of 3 separate MLS systems for 3 counties. Two of those systems are from the same company, so they effectively have to pay twice to use the same software.

Data Feeds - These systems allow members to receive and post all listings on their own personal sites, but I've looked at the format that some of the data currently comes in and its pretty rough. Zipped excel files. XML is they way they need to start going with this stuff to stay competitive. Also, when you sign up, current rules allow other realtors (at least in Michigan) to post your listings next to a nice big picture of them, only crediting that actual listing in the fine print. These are typically public Internet websites and many end consumers don't realize that the real listing agent is way down below in the fine print. Now why would I want my listings in a system like that?

Lack of Search Engine access - Most MLS Systems themselves can't be crawled by search engines, so you won't find listings from MLS systems by looking on Google.

In short, I believe in time - and it may take a while - more and more realtors are going to start seeing and believing in other Internet advertising strategies, and unless local MLS systems get more effective and competitive, they'll either go by the wayside, or get swallowed by the MLS Systems that do a better job of competing.

For an example of how the Internet is slowly begining to fundamentally change the Real Estate Market, see this article by Nick Karris at Gomez.com

Appropriate use of RSS Feeds

Most Realtors know that members of MLS Systems happily subscribe to MLS area listing data and then create websites that display their own information next those listings, only crediting that actual listing agent down at the bottom of the page in fine print. This typically makes the listing appear as if its thiers to those outside the Industry that don't know to look to the fine print to find out who has it listed.

Now along comes RSS, allowing for people to build such pages with similar designs using RSS. But be carefull whose feeds your using. They may not wish to have their content displayed elsewhere on the web, and they may be giving you the entire detail of the articles and not crediting themselves well in their title. This could technically create copyright problems, despite the fact that they published an RSS feed, and I think many folks assume that if a feed is offered, its an open invitation for use. I recently ran into such an issue, even though the content did not involve listings, and didn't serve the same market as my folks business.

Also I wanted to run a little survey, so feel free to take the following

When you see a link to an rss feed on the Internet, in order to use it on your own site you should: Call the source of the feed to gain permission Credit the source with a hardcoded message on your site when the feed displays Nothing - since they control the content, they can credit themselves in the title Both 1 and 2 Add your comment Create Your Question - Worldsentiment