Good Reading – The New Rules of Real Estate

I recently read Zillow Talk: The New Rules of Real Estate by Spencer Rascoff and Stan Humphries.  It’s a book in the “Zillow Talk” series and the authors are the CEO and Chief Economist, respectively, at Zillow, an online platform for housing data.  Zillow and Redfin are the biggest players in the space for MLS listings accessible to the public.

The book is a quick read – 258 pages – but is entertaining and has some interesting anecdotes and insights.  If you’re interested in real estate or work in the industry I’d definitely recommend checking it out.  Some of the items I most enjoyed learning about were:

• Breakeven Horizon – A tool that Zillow has put together to estimate the number of years it would take for renting a residence vs. buying to even out when considering tax benefits, expected appreciation of real estate, etc.  In San Diego County the breakeven is 3.8 years so if you expected to live here for 5 years it would probably make more sense to buy rather than rent.  At the end of 2014 that national breakeven horizon was 1.9 years, there’s a lot of variation among markets.  Interesting tool to check out if you’re considering whether to buy or rent.
• Words Matter – The book takes a look at how words affect home values in a variety of ways.  Which street suffixes are most valuable? Way, Place, and Court.  Which are least valuable? Street, Road, and Avenue.  The less valuable suffixes are the more common ones.  The book also looks at named streets vs. numbered streets (named streets are much more valuable – 33.5% more valuable in Dallas!).  Which words to use in a listing  to maximize price is also discussed – granite and stainless are great to use but cosmetic and TLC should be avoided.  More words in a listing also help quite a bit.
• Timing (and Pricing) Matters Too – When is the best or worst time to sell or buy a home? It varies during the year, and in different ways in different markets.  December is a great time to buy generally and March/April is a great time to sell.  Having your listing price end in a 9 is a great idea but ending in a 4 is a bad one.  8 is also a great ending digit if you’re in an area with lots of Chinese residents.

Fun read and lots of interesting trivia and tidbits to absorb.  Well worth a couple of hours if you’re buying, selling, or potentially doing either in the future.  Enjoy!