Tight Market Sparks Increase in Rental Scams

By ANTHONY KLAN

With Manhattan's rental-housing market tightening, the danger is growing of apartment hunters falling victim to scams, real-estate agents and white-collar crime experts warn.

The most common scam involves legitimate rental offers, which scam artists are doctoring and posting on listing services such as Craigslist for lower rents, agents say. Eager victims send deposits only to learn that the apartment's actual owner knew nothing of the deal. The deposit, of course, is never seen again.

"We are seeing more and more people looking for rentals," says Jason Boone, a research associate at the National White Collar Crime Center, which fields and collates online-fraud complaints for the Federal Bureau of Investigation. "This gives scammers a lot of incentives to be creative and we're seeing an overall increase in the number of rental scams."

Close to 5,500 rental-scam complaints were received nationwide by the start of October, Mr. Boone says. That puts 2010 on track to possibly eclipse last year's record 7,225 complaints.

Statistics for New York alone aren't available. But Stephen Kotler, executive vice president and director of rentals at Manhattan real-estate agency Prudential Douglas Elliman, says the firm was aware of three cases in the past two months alone where suspicious would-be renters contacted the firm and established that listings had been copied by bogus operators.

"We have definitely seen an increase in this type of fraud recently," he says. "With the Internet it is very easy for people to scrape information from any website and present it as their own."

Gary Malin, president of Manhattan real-estate agency CitiHabitats, says renters needed to be particularly vigilant in the current market. "You should never be in a circumstance where you end up reading something that sounds great and people you have never met are asking you to wire money for a place you haven't even seen," Mr Malin says.

His advice: "The smartest thing for anyone to do is to say 'let's get in touch tomorrow' to give you time to examine the situation."

Craigslist spokeswoman Susan MacTavish Best says the site goes to "great lengths" to prevent scams, employing a wide array of measures such as warning users "at every turn and on every page" how to avoid being taken in by scams and providing detailed information on how to report scams to the authorities.

She says the two key rules for avoiding online scams were to deal locally with people the renter could meet face-to-face and to never wire funds.

It's not just renters being fleeced in the current market, the FBI warns. In a twist to the scamming, landlords occasionally are contacted by potential "renters" who agree on a rental price. The scam renter then sends a check for the deposit on the rental property but shortly afterwards backs out of the rental agreement and asks for a refund.

Sometimes the landlord sends back a refund before realizing that the deposit check is counterfeit and hasn't been cleared by the bank.

Mr. Boone says that while some rogue operators have become increasingly creative in developing new methods of fleecing the public, many of the scams remained very simple. "But at the same time it's often that simplicity that catches people out," he says.

Write to Anthony Klan at anthony.klan@wsj.com

Small but spacious condo

The website Freshome recently featured a beautifully designed studio condo in New York City’s East Village. The space is only 500 square feet, and the architecture firm JPDA found a way to take advantage of every inch of it:

I truly love the storage in the risers of the stairs. I also love how the space has a designated office built right into the room.

Be sure to check out all the photographs of the condo. I’m pretty sure the bathroom sits in the closed space between the kitchen and the living room (under the stairs) and the area between the front door and kitchen is storage. (A final note: I think the 15th picture in the series is from the Indigo Lounge redesign and incorrectly in the photo series for this home.)

 

Borrell Associates’ 2011 Ad Forecast Memo

2011 ONLINE AD GROWTH TO OUTPACE TOTAL AD SPEND GROWTH2011-Forecast

 

Borrell Associates is forecasting a moderate increase in overall ad spending for 2011, but continued strong growth for online advertising, including mobile. Overall, advertisers will increase their spending next year by less than 5% above this year's projected level, bringing U.S. ad spending totals to $238.6 billion.

We're expecting total online ad spending to grow almost 14%, from $45.6 billion, in 2010, to $51.9 billion, in 2011. The fastest-growing segments of online advertising are the local sector, anything targeted, and everything involving social media.

By next year, local online advertising should grow by almost 18%, from $13.7 billion, in 2010, to $16.1 billion, in 2011.

The big driver will be targeted display (such as banner ads) advertising, which we expect to grow almost 60% in 2011, reaching $10.9 billion for national and local combined. While national advertisers will increase their use of targeted display by nearly 50%, local advertisers will outperform even that. Use of targeted display by advertisers local to the markets where their ads run will more than double, reaching more than $2.3 billion next year.

 

However, the Web's initial darling –run-of-site display– continues to lose luster. Sales of run-of-site display ads will continue to decrease, dropping nearly 14% from this year's level – from $9.5 billion to $8.2 billion for both local and national. This early online format has simply been overshadowed by newer, more productive ad formats, and competition has pushed display unit prices down. Most of the spending decease will come from national advertisers. Local run-of-site ads are forecast to decrease less than 3% next year.

The national paid search ad format will experience a double-digit spending decline next year, moving down 11.3%. This drop will be caused by lower pricing and churn, but will be mitigated by a local advertiser increase of more than 10%. (In general, local online advertiser trends tend to lag those of the larger national advertisers by about two years, and that is certainly the case for paid search.) Local spending decreases in paid search are sure to follow, perhaps as soon as 2012.

Email advertising will see moderately strong growth in 2011, up 9% to $16.0 billion for national and local. Growth in this format is almost all from national advertisers; only 3% is local. White paper marketing is a major contributor to its popularity – especially among B2B advertisers.

The streaming video format is expected to continue its dramatic growth, increasing more than 60% to $5.6 billion next year. More DIY and less expensive tools put this ad format within the budgets of even small advertisers. Because of this, two out of every five streaming video ad dollars will come from local advertisers next year. Streaming audio, on the other hand, looks to remain a footnote. Though it too will enjoy double-digit ad spending increases in 2011, streaming audio has yet to pass the $1 billion ad spending level.

Unlike legacy marketing, where promotions overshadows advertising, online advertising has historically gotten far more attention from marketers than online promotions. But changes are coming. Online promotions will top $24 billion next year, up 10% from this year's totals. Much of this increase will be due to the rising use of online couponing, forecast to grow almost 14%, to $9.1 billion, in 2011. Proximity advertising is also on the rise, up 11% next year. Mobile devices that can tell users when a particular merchant is in their immediate vicinity continue to sell briskly, and advertisers are expressing interest in this form of advertising.

Mobile marketing continues to grow, fueled by ubiquitous apps, user-friendly browsers and 3G/4G speeds. As smartphone ownership now comprises 25% of all cellphone ownership, mobile ad sales will enjoy growth of more than 20 cents of every online ad dollar spent next year.

Subscribers to Borrell research will be able to download the 2011 Detailed Forecast for free.  Everyone else will be able to download the 2011 Summary Forecast for free. For more information about a subscription, call Martin Nyberg at 253-678-1975 or email him at mnyberg@borrellassociates.com This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

The next Borrell 2011 Forecast will be issued as 3rd quarter data becomes available. For questions about this forecast, please call 757-221-6641 or e-mail info@borrellassociates.com This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

Click here to download the 2011 Online Ad Spend Forecast by DMA (Designated Market Area)

 

The Likelihood That an Agent Will Sell a Listing? Less Than 50% | Redfin Corporate Blog

August 15, 2010

The Likelihood That an Agent Will Sell a Listing? Less Than 50%

A couple of weeks ago, Redfin engineers got together for a hackathon to prototype features we’d like to see on the site. One team, featuring Jane Nemenman, Jamie DeMichele, Dane Brandon and Llewellyn Botelho, built a Redfin.com widget for each listing that showed the listing agent’s track record: how many listings he had on the market, what his average discount to list price was, how long it had been since he closed a deal.

It was a great idea. But it didn’t all come from the engineers. The original insight started with our San Francisco agents, who like to size up a seller’s agent before deciding how to represent a buyer in a negotiation, on the theory that negotiating strategy is often influenced as much by the listing agent’s state of mind as by her client’s. Some agents are chronic over-pricers, expecting to give part of that away at the negotiation table. Others stand firm. And still others just need to get a deal done.n1058812379 2718 The Likelihood That an Agent Will Sell a Listing? Less Than 50%

Jane, Jamie, Dane and Llewellyn wanted to give everyone this information, so that anyone using Redfin’s site could know what she was up against going into a negotiation. Then we dug into the rules that govern how we use listing data, and decided that using the broker’s database of listings to embarrass brokers publicly wasn’t a fair use of the data.

We’ll still build this into the tools our agents use, so we can help all of our customers know when to hold ‘em and know when to fold ‘em. We’ll also share with everyone the listing stats for our own agents. In the meantime, what I haven’t been able to stop thinking about was how the engineering team reacted as Jane demonstrated the widget, showing the dismal stats for one seller’s agent after another.

Folks were flabbergasted. At first, people thought it was just one agent having a tough year. But after a few minutes of  clicking from one listing agent to the next, everyone began to recognize the truth: that in 2009 it was very hard for any agent to sell a home.

So when we got back to our day jobs, Jamie DeMichele — the man who also created bracket-tracking software for March Madness — looked up the numbers for all the listings put on the market in 2009, to see how many had sold by August 11, 2010. The answer? About half. He emailed me the table below, which summarizes the success rate for broker-listed properties for sale in seven major markets:

County Name Listings Activated in 2009 # 2009 Listings Sold % 2009 Listings Sold # Still Active % Still Active
Cook County, IL 134,710 44,789 33.3% 7,893 5.9%
Fulton County, GA 27,089 9,941 35.8% 1,329 4.8%
King County, WA 51,252 21,500 42.0% 1,729 3.4%
Los Angeles County, CA 130,326 68,564 52.6% 3,079 2.4%
San Francisco County, CA 9,289 5,259 56.6% 112 1.2%
Maricopa County, AZ 137,647 81,204 59.0% 5,008 3.6%
Suffolk County, MA 15,763 5,682 36.1% 393 2.5%
7-County Average 506,796 236,939 46.8% 19,545 3.9%

We shared the data over the weekend with the Wall Street Journal, which just published its own analysis. As we’ve argued in the past, the basic problem is a stand-off between buyers who expect the world, and sellers who have already taken more losses than they can bear. When no one will compromise, and the banks have been slow to foreclose on overdue mortgages, listings don’t sell.

What does this mean for you if you’re trying to sell a house? Primarily: don’t hire the agent promising the highest price, no matter how flattering that may sound. Hire the agent with the best track record. If 2010 is anything like 2009, odds are that the property won’t sell at all, or at least  not  at the originally promised price.

(Picture of Jamie used with his permission, at his insistence that I use one where he’s wearing cowboy boots)

Posted on Sunday, August 15th, 2010 at 10:20 pm by Glenn Kelman under Redfin in the News, The Science of Real Estate, Uncategorized.

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FTC Considers Do-Not-Track List 07/28/2010

The Federal Trade Commission is considering proposing a do-not-track mechanism that would allow consumers to easily opt out of all behavioral targeting, chairman Jon Leibowitz told lawmakers on Tuesday.

Testifying at a hearing about online privacy, Leibowitz said the FTC is exploring the feasibility of a browser plug-in that would store users' targeting preferences. He added that either the FTC or a private group could run the system.

Leibowitz said that while Web users on a no-tracking list would still receive online ads, those ads wouldn't be targeted based on sites that users had visited in the past.

Three years ago, a coalition of privacy groups including the World Privacy Forum, Center for Digital Democracy and Center for Democracy & Technology proposed that the FTC create a do-not-track registry, similar to the do-not-call registry. At the time, the online ad industry strongly opposed the idea of a government-run no-tracking list.

Currently, many people who want to opt out do so through cookies, either on a company-by-company basis or through the Network Advertising Initiative's opt-out cookie (which allows users to opt out of targeting from many of the largest companies). But those opt-outs aren't stable because they're tied to cookies, which often get deleted.

The Network Advertising Initiative recently rolled out a browser plug-in that enables consumers to opt out of targeted ads by NAI members.

Leibowitz also told lawmakers that he personally favored opt-in consent to behavioral targeting, or receiving ads based on sites visited. "I think opt-in generally protects consumers' privacy better than opt-out, under most circumstances," he said. "I don't think it undermines a company's ability to get the information it needs to advertise back to consumers."

Online ad companies say that behavioral targeting is "anonymous" because they don't collect users' names or other so-called personally identifiable information, but Leibowitz said that it might be possible to piece together users' names from clickstream data. He told lawmakers about AOL's "Data Valdez," which involved AOL releasing three months' of "anonymized" search queries for 650,000 users. Even though the company didn't directly tie the queries to users' names, some were identified based solely on the patterns in their search queries. Several lawmakers expressed concerns with behavioral advertising during Tuesday's hearing. Sen. Claire McCaskill (D-Mo.) said she was "a little spooked out" about online tracking and ad targeting.

McCaskill said that after reading online about foreign SUVs, she noticed that she was receiving ads for such cars. "That's creepy," she said, likening it to someone following her with a camera and recording her moves.

She added that if an "average American" were to learn that someone was trailing him around stores with a camera, "there would be a hue and cry in this country that would be unprecedented."

Sen. Jay Rockefeller (D-W. Va.) and Sen. John Kerry (D-Mass.) both expressed concern that privacy policies weren't giving Web users enough useful information about online ad practices.

Rockefeller proposed that some companies were burying too much information in lengthy documents that consumers don't read. "Some would say the fine print is there and it's not our fault you didn't read it," he said, adding, "I say, that's a 19th-century mentality."

Kerry added that he didn't know that consumers understood how companies use data. "I'm not sure that there's knowledge in the caveat emptor component of this," he said.

Social cues, social responses, humans know when a computer is engaging them | Real Estate Relativity

Social cues, social responses, humans know when a computer is engaging them

Posted on Wednesday, 2010, July 28, 17:18, by Eric Bryn, under social media, social media and direct marketing research.

This research paper from Nokia Research Center, Stanford, and Queens University implies that humans can ascertain with an uncanny degree of certainty when a social message is sent from a computer versus a human. Social responses to communication technologies theory (SRCT)  predicts that humans cannot reliably ascertain such nuances. This research contradicts this premise.

The research team, using prior research in SRCT theories, tested whether humans could discern whether a text message was sent via a human or computer when flattery was an element of the message. They found that humans reliably discern the originator of the message apparently because certain social cues were missing in the computer-generated messages.

Why this is relevant research: SRCT theories could be used by software designers to create computer programs to engage social network users with the goal of getting them to increase self-disclosure under the guise of an interaction seemingly being conducted with a human. With the FTC recently considering allowing people to opt-out of behavioral targeting on the Web, the issue of nudging people towards more self-disclosure is timely given all the issues surrounding privacy and use of PII in social networks, especially if a user discloses such PII under the assumption they’re interacting with a human. This is a very interesting article and quick read (four pages).

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