For a year, SuffolkResearch.com has been posting monthly updates to a “3 Month Running Average” graph of single family home median prices on the East End of Long Island. (SEE IT HERE)

Two months ago (three month running average of Feb 09 Mar 09 and Apr 09) the trend was still down — they appear to be leveling off now! Prices have dropped to 2005 levels.

See the 3 month running average curve HERE.

Posted on June 10th, 2009 by admin
Filed under: The Market | No Comments »

The May 11, 2009 issue of the New York Times contains an important article about the Obama administration crackdown on the lax antitrust policies of the Bush Administration.

The Article starts:

“WASHINGTON — President Obama’s top antitrust official this week plans to restore an aggressive enforcement policy against corporations that use their market dominance to elbow out competitors or to keep them from gaining market share.
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Susan Etheridge for The New York Times

Christine Varney, left, of the Justice Department’s antitrust division.

The new enforcement policy would reverse the Bush administration’s approach, which strongly favored defendants against antitrust claims. It would restore a policy that led to the landmark antitrust lawsuits against Microsoft and Intel in the 1990s.

The head of the Justice Department’s antitrust division, Christine A. Varney, is to announce the policy reversal in a speech she will give on Monday before the Center for American Progress, a liberal policy research organization. She will deliver the same speech on Tuesday to the United States Chamber of Commerce.

The speeches were described by people who have consulted with her about the policy shift. The administration is hoping to encourage smaller companies in an array of industries to bring their complaints to the Justice Department about potentially improper business practices by their larger rivals. Some of the biggest antitrust cases were initiated by complaints taken to the Justice Department.”

Read the whole article: (HERE)

(AND HERE)
(AND HERE)

(AND HERE)

Here’s the statement from the Under Secretary of State for Antitrust: (HERE)

Posted on May 12th, 2009 by admin
Filed under: Law-breaking, The Press | 1 Comment »

Phil Cardone is an experienced supplier of internet based MLS systems.  He wrote the following analysis of the O.R.E.X./RealNet system and MLS systems.  Phil’s Company’s website (HERE)

I DON’T MIND A PARASITE…

Embezzlement? Theft? Betrayal? The naked criminality in the Hamptons Real Estate market is no surprise given its oft-referenced umbilical cord attachment to Wall Street. After reading this blog and seeing the predatory pricing, I felt a sense of civic duty to contribute an editorial. A Sag Harbor native, and graduate of a top-ranked business school, I currently work as a Real Estate Web Consultant serving hundreds of clients in the NYC Metro Area. Based in Port Washington, NY, eRealty Solution has designed, built, maintained and marketed solutions for agents, small brokerages, and multiple office systems for both privately owned firms and franchisees. Germane to this discussion, we also constructed and manage the North Shore Multiple Listing System (NSMLS.com), which services dozens of brokerages in Queens. We also integrate our technology with many large MLS organizations across the United States.

I can say, without question, that the Real Net / OREX / HREO system for which there is heated debate should not incur a $40,000 setup cost to a new user, nor thousands in annual maintenance fees. A few thousand and a few hundred per month is far more sensible and fair. As Bogart says to Lorre in Casablanca, “I don’t mind a parasite, I object to a cut rate one.” I’ve been told that some smaller offices, the early adopters from back in the ‘90s enjoy a discount. But current subscribers and previous ones have said these retail figures are accurate. I qualify this statement if proven otherwise because I do not possess invoices.

To be sure, Real Net may have cost 40k in development fees (labor costs) from start to finish, though it is doubtful that 19 people were required. The number 19 appears often in big lies. As someone who has coordinated projects of this nature with teams in Eastern Europe, the Pacific Rim, and in New York City, it is unlikely they employed that many programmers and for good reason. More chefs, more often than not, reduce efficiency. An enterprise real estate application of Real Net’s class needs only a handful of developers. And the raw server costs and alleged one -person support staff simply do not justify what are meteorically higher than industry average yearly fees, given its current functionality, which looks fairly standard.

Surely, its engineers will supply sonorous descriptions of its sophistication, but when boiled down to its elements, the software simply organizes, hosts, and syndicates data. Many companies could create and run a system for a fraction of the cost. There need only be demand from its overcharged subscribers to start!

Destroyer Pricing

Our setup costs for an agent or brokerage website fall between 1k and 3k, with monthly maintenance fees ranging between 99 and 199 / month, the latter including virtually unlimited accounts for agents who can do a panoply of business management tasks from the administration side. This includes daily database imports of 35,000+ listings, advanced statistics tracking, lead management, content management, syndication, et al. Our fees to the North Shore MLS organization are higher, but pricing is scaled much lower per individual office because of its membership volume, similar to how Real Net / HREO could / should be structured. But it would be nowhere near a 40k+ setup for just one office!

Even the Real Estate Board of New York’s (RLS) and Online Residential’s OLR.com, two of the largest Manhattan listing databases, sell their membership at a slice of Real Net’s setup and maintenance, despite not functioning as an MLS. I ask the readers not to use my benchmark pricing as gospel. Do your own research. Contact them today! Rebny.com and Olr.com. You can also call MLSLI.com and get pricing for a new office.

Bottom line, Real Net is milking the monopoly they were savvy enough to create. And until there is formal resistance, they will continue to do so. Top brass at colluding firms clearly won’t resist, as they are fully aware of the preposterous pricing compared to every other listing / sharing system / portal in the country. So if it’s clear that the billing is outrageous, and it’s clear that there’s no angst among its premium members, then simple Socratic deduction leads us to the unsettling conclusion of complicit agencies, and willful consent of their sales force.

Follow the money.

It is widely known that unregulated brokers want to keep listing inventory close to the chest, or shared betwixt a small number of firms. The reason is obvious… to increase the chance of double ending a deal, and to keep other brokers out of the commission pie. Burn the canal!…but after I cross it. Where’s Teddy Roosevelt? Bust this Trust! Upon discovering this fraud, I now inform family and friends who live in Sag and surrounding areas not to list with agencies who do not share / co-broke listings with all Realtors. Widespread awareness of the swindle is part of the solution. Readers and oppressed agents should notify every homeowner that these listing leeches are costing them opportunities.

A prime exemplar of this dichotomy is the failure of Prudential Douglas Elliman agents to add listings to the Multiple Listing System of Long Island’s website (MLSLI.com) As of April 14, 2009, this site shows only 6 listings for sale in Bridgehampton. Of these 6, only 2 are listed by PDE. Yet there are 108 listed for sale in Bridgehampton on Prudential’s corporate website! http://www.prudentialelliman.com/MainSite/Search/HNF.aspx?Type=Sale

The Long Island Board of Realtors stipulates that every licensed real estate agent is required to be part of the MLS if their brokerage is a member. Thus, every PDE agent in the Hamptons is also registered with MLS and pays an annual fee of $400 to be a member. Check for yourself. Visit www.MLSLI.com. Click on ‘Find a Realtor’ on the left navigation. Search any PDE agent you know, and they will be displayed.

Let’s use one of Bridgehampton office’s top agents, Lori Barbaria, as an example:

Below is a screenshot of her $22,000,000 Exclusive Offering.

Don’t bother checking MLSLI.COM. You will not find it there. Indeed, there is an occasional seller that wants their home sold privately with the listing office, and does not want it publicly broadcast. However, this is not the case on the present listing, because it is advertised on the Real Net System.

Here are a few more agents at random:

Sag Harbor:

Southampton:

East Hampton:

Let’s use another one of Bridgehampton office’s top performing agents as an example, Vincent Horcasitas:

Here’s one of Vincent’s in Water Mill:
Why isn’t this listing on MLSLI.com, when thousands of other agents could potentially have a Buyer for this home? Maybe the Seller requested it otherwise, but since it’s on Real Net / HREO, it must be a conscious decision. I do not know whether this violates Rule 203, but I will say that despite them being an ‘800 lb Elephant,’ and ‘sitting where they want to sit,’ PDE needs the MLS throughout Suffolk, Nassau, and Queens, and if consistently punished for the alleged discretions, its 800 lb mass would rapidly shed weight!

Some agents might reply: “But the Hamptons is a different market.” Or some other elitist remark.

Really? Than why do many Prudential Agents put their 8 figure listings on the Multiple Listing Service?

Case in point, here’s a 19+ million listing in Sand’s Point by a Realtor near our office.

I encourage all readers, especially homeowners who’ve listed with PDE to visit MLSLI.com. Click on ‘Find a Home.’ Perform a search from Westhampton to Montauk and outside of a few, you most likely won’t see your listing that is shown on PrudentialElliman.com or Real Net / HREO. That’s well over 100,000* people per month, who are looking for homes on MLSLI.com, and several hundred thousand more who search its’ member websites, who will not see your house for sale. Deliberate under-exposure is a serious injustice.

*Google AdWord Keyword Tool – April 14th, 2009. Does not include other search engine data.

At the 2008 Inman News Trade Show in Manhattan, (Inman News is a prominent industry publication) Dorothy Herman said that she belongs to MLS because it is “in the best interest of the Seller.” Her very words! So if Dorothy and the PDE family think MLSLI is important enough for the vast majority of their offices and agents throughout Long Island & Queens to use, “because it’s in the best interest of the Seller”, then why are they so reluctant to put their Hamptons’ listings on the Multiple Listing System? Surely these 108 we see on the corporate site are not all open listings or in-house exclusives (co-exclusives can go on MLS). When asked why there was such a discrepancy (last years variation was different from present day April 14, 2009) she replied that she was unaware her agents weren’t posting on MLS and that they should be. Sure she wasn’t aware

Listing Agents should have acute awareness of their fiduciary obligation to the Seller. For example, Corcoran’s policy of not co-broking their listings with all brokerages is at odds with its parent company, which controls several prominent real estate brokerages nationwide, all who use myriad Multiple Listing Systems. With such humble beginnings, it’s a pity that so many of its agents are profiting from Barbara’s name yet lack the humility and warmth from which the original brokerage was founded. If they did some homework on their parent company’s interlocking corporate directorships with their own ‘competition,’ it may shed light on their true position on the totem pole.

In closing, I applaud George Simpson for exposing this rapacious racket. And though I do believe there are good men and women amongst the thieves, reluctant acquiescence is no longer an acceptable position.

At a certain point, silence is consent.

Philip Cardone
Real Estate Web Consultant
eRealty Solution, Inc

Posted on April 17th, 2009 by admin
Filed under: Law-breaking, RealNet/Orex, The Market | 1 Comment »

See the article:  (HERE)

Posted on April 15th, 2009 by admin
Filed under: The Market, The Press, What agents do | 1 Comment »

The Corcoran Group, Prudential Douglas Elliman, Brown Harris Stevens, and Town & Country are engaged in a rule breaking practice which damages their competition.  By deliberately avoiding their responsibility to put all their exclusive listings on MLSLI – these MLSLI member agencies keep the exclusive O.R.E.X./RealNet club going.

The way I see it, if these four agencies started following the MLSLI rules, as they are bound to do by the terms of their MLSLI membership, O.R.E.X./RealNet would go out of business.

These four agencies exclude out-or-the-area agencies and local smal agencies from access to the most profitable Hamptons listings. 

Several years ago, Dana Berger (Hamptons Fine Homes owner) and I were meeting at Long Island Board of Realtors (LIBOR) headquarters. We were meeting with Debbie Franco, Membership Coordinator of MLS, at LIBOR, (Multiple Listing Service Long Island — MLSLI).

I asked Debbie Franco why MLSLI doesn’t enforce their rules on MLSLI member Prudential Douglas Elliman.  I said that Prudential has a terrible record for failing to put their exclusive listings on MLSLI in accordance with NAR Rule 203. (Rule 203 requires MLSLI members to keep to the rules in all their offices). See (RULES)

Her answer was:

“an elephant can sleep where ever she wants”

– reference to Dottie Herman who runs Prudential Douglas Elliman, the “elephant” of real estate agencies on Long Island.

My response to her was:

“and if you enforce the rules on Dottie’s company, she will get you fired”

– she nodded with a knowing look. 

Now, this practice of not putting Hamptons listings on MLSLI is standard operating procedure, at Prudential Douglas Elliman, The Corcoran Group, Brown Harris Stevens, and Town & Country.  All of these agencies are members of MLSLI and as I read the rules, by the terms of their membership agreement, bound to the rules of the organization — including Rule 203.

These agencies do NOT have the right to ignore MLSLI rules — but in my experience, breaking the rules is what these agencies do best.

What’s the big deal, if these agencies don’t put their listings on MLSLI ?  

Every listing left off MLSLI decreases the listing inventory for other rule-abiding members of MLSLI — members like South Fork Realty, Quogue East Realty, Options Realty, Real Hamptons Real Estate, The Real Estate Store, Ocean View, Forth Neck, Kerrigan Country, the list is very long, perhaps 1,000 agencies are victims of this “against the rules” exclusion effort.  The reason any agency joins an MLS is to get access to the complete exclusive listing database in the market.

I am not aware of any rule which allows these agencies to avoid following Rule 203.

I believe that the damages due to these omissions could be enormous — and the finger of liability/blame should be pointed at:

1) MLSI
2) The rule breaking agencies
3) Perhaps the National Association of Realtors (NAR)

Fines from MLSLI for not putting listings on the System (HERE)

Posted on March 22nd, 2009 by admin
Filed under: Brown Harris Stevens, Corcoran, Libor, Prudential, Realogy, Town & Country, What agents do | 8 Comments »