Why Real Estate Technology is Lagging Behind

So you want a cool real estate investment app?  Well, good luck.  Real Estate is a monstrous industry and most people end up buying at least one house in their lifetime.  Have you noticed there are no good apps or software for the real estate investor?

Even the big players like Zillow, Trulia, and Redfin are shying away from this.  They have wonderful websites, but they don't help you, as an investor, purchase your next house.

A study done by Biggerpocket.com and Memphis Invest said there are 28.1 million US real estate investors.  That is the roughly the same number of people who own Roth IRAs or money-market share holders.  So why do we have Etrade or Scottrade, but nothing powerful enough to buy/sell real estate?

As a startup trying to solve this problem, let me first tell you why there are no good programs.

Real estate data is a huge mess!

Here are some facts:

• 1365:  Different Local Realtor Assoc.
• 900+:  Multiple Listing Systems
• 3007:  Unique Counties
• 517,800:  Total Brokers
• 165,000:  Total Brokerages
• 1 Million+:  Total Realtors

Every MLS and County uses their own data format.  There is zero standardization and no leadership from NAR to get better data standards. Sure there is a push from the Real Estate Standards Organization (RESO) and startups like rets.ly that are trying to standardize the data, but what do you do when you have incomplete or wrong data?  Garbage In = Garbage Out

On top of that, the MLS boards do not want you to have the data.  They want to put it behind a lock and key and make customers and brokers jump through hoops to see sold date. There are three ways to have access this MLS data.

1.  Vendor -  Create a product and you can ONLY sell it to agents. So the MLS are okay having vendors charge Realtors for their own data, but the vendors can't charge the public?
2.  Broker -  Become a brokerage and apply for a VOW feed. The MLS's don't want creative brokers to have access to this data as a proof in the DOJ vs NAR antitrust case.
3. Portal - The MLS's will syndicate limited data via List Hub, Point2 to Zillow or Trulia and convenience agents that it is  Zillow or Trulia's fault for the inaccurate data.

The Chicago Tribune says:

"The real estate industry is hungry for technological breakthroughs, and opportunity awaits existing business-to-business startups that can expand to serve it, real estate investors and entrepreneurs say.”

We think that:

No One Shares Data + No Standard Format + Not Investor Friendly = Huge Opportunity

Inman News has a great article how over $1B is being spent on real estate startups.  All of these companies are awesome, but I could not find one that focuses on the investor.

So, why is there 28.1M investors, but no cool apps for them?  Perhaps there should be.

ReZamp.com is a nationwide brokerage with powerful software that analyzes every property on the MLS.  ReZamp is free to use with no obligation to use ReZamp as your brokerage.  Anyone, even the general public, can use it.  

ReZamp is currently operating in Phoenix, Tucson, Tampa, Orlando, Las Vegas, Denver, Houston, and Jacksonsville.

5 Easy Steps to Get Your House to Appraise

Appraisals can kill your deal and cost you thousands of dollars.  This article will help you avoid a low appraisal!

It is true that you cannot pick your appraiser. Appraisers are supposed to be independent third parties to the transaction. Not all appraisers or lenders are created equal though. Lenders can chose their appraisal management companies which in turn chose the appraiser.

Their are aggressive and conservative appraisal management companies.  It is your job to find out which lenders use the aggressive appraisal companies.

Here are some quick tips:

1. Use a Lender you trust 
Yes, I know you cannot pick the appraiser or the buyers lender, however you can reject/counter offers based on a buyers lender. Lenders are not a protected class. It is not a coincidence that investors have their favorite lenders and provide incentives to use them. Get creative and offer incentives for buyers to use your lender. This is much easier in a sellers market vs. a buyers market. If you cannot get them to switch, then the tips below will still help.

2. Make the appraiser call you. 
Change the MLS listing to state that all showings must call the listing agent first before entering. The reason for this is so you can get their phone number and email. Once you get their email send them remodel costs and comparable sales (comps) for the area. More on this later.

3. Let the appraiser do their job 
Don't get in their way and don't make their job harder. Make sure they can access all areas of the home, and have easy access to walk the property. I never even meet the appraiser, I just provide the lockbox code and let them go on their own time.

4. Remodel and Upgrade Costs
Put your remodel costs together into an easy to read and easily printable format. I use Excel, but you can use anything. Just make it easy for the appraiser to see the improvements you have done to the property.

5. Comparable Sales 
I send 3 comparable sales to the appraiser even if they don't request them. This lets them know you've done your homework and know the area well. Some appraisers will ask for them, and some don't. Send them either way. I use ReZamp's built-in CMA function for this, but you can use any method that works best for you.

Thats it!  These five steps will save you thousands of dollars and avoid the dreaded low appraisal.

What tips do you have on getting houses to appraise?