Selling and buying a home with iBuyers

Tech actors now in the real estate business continue to try to shake up the process:

They work like this: These companies, dubbed “iBuyers,” make cash offers for your current home at an algorithmically determined “fair market price,” allowing you to take the money, buy your next home, and move out at whatever date works best for you. The transaction closes in a matter of days.

The companies then clean and fix up your old house and sell it on the open market, collecting a fee from the seller. And because the price at which iBuyers buy the house is usually not the maximum the house would fetch if it was sold traditionally, they likely make a small gain on the sale price…

Perhaps the most striking evidence of iBuyers’ influence on the real estate industry came from Keller Williams CEO Gary Keller in January. When discussing the company’s intent to launch an iBuyer program later this year, Keller told Inman “I feel like I have no choice now.”

After posting $1.33 billion in revenue in 2018, Zillow announced a three- to five-year revenue target of a whopping $22 billion, $20 billion of which was projected to come from buying and selling homes.

It will be interesting to see how much iBuyers are co-opted or acquired by traditional real estate actors or whether they will stand on their own. And will this lower costs for consumers and/or give them advantages or will it consolidate power and knowledge into different hands?

Does all of this threaten to keep moving real estate toward a commodity? This appears to be the road we are already on with the shift from thinking about American homes as places to live and anchors in a community to seeing them primarily as investments and critical parts of retirement portfolios. Imagine doing more and more of this without seeing the homes in question and with lenders and middlemen who have little knowledge of the particularities of a neighborhood or community. Algorithms can do a lot – and possibly even reveal patterns humans tied up in local details have a hard time seeing – but they may have a hard time imparting the aesthetic and lived experience of homes and locations.

Going further, iff more people are moving toward less civic engagement, more engagement with screens, and social ties primarily chosen based on family, friends, and interests (some evidence to back all of these up), perhaps it may not really matter exactly where people live as long as it is relatively close to what they want. Why would you need to visit a place or pick a specific home or neighborhood if those local ties and interactions matter little?

Will smart cities necessarily be lonely cities?

This piece thinks about how smart cities might affect social relationships and the prognosis is not good:

By 2050, more than 66 percent of the world’s population will be living in so-called “smart cities.” These are metropolitan areas where everything will be digitally connected. Today, some people have “smart” thermostats, refrigerators, or smoke detectors. Tomorrow, we’ll have smart hospitals, farms, and highways, and it’s likely they’ll all talk to one another. Connected devices will monitor everything from air quality to energy usage and traffic congestion…

We can also expect more part-time work, distance working, and the blurring of our work and personal lives. Some worry that the rise of robots could force governments to legislate for quotas of human workers.

But city-dwellers will see incremental changes outside of their workspace, too. Thanks to self-service checkouts and home delivery services, technology is creating less of a need for us to actually interact with those around us. Message bots, like Google Assistant, Siri, and Amazon’s Alexa, will soon be able to suggest restaurants, hotels, and other local landmarks. This is already happening in places like Tel Aviv, where everyone over the age of 13 can receive personalized data, such as traffic information, and can access free municipal Wi-Fi in 80 public zones. Populations will be encouraged to make good use of these ever-personalized digital services, since this gives companies our precious data, which will be integral to smart cities…

But it’s doubtful that these interventions will be enough to counteract further encroachment of technology on cities’ infrastructure. Resistance needs to be on a grander scale. One solution may lie in the preservation of public spaces such as parks, community centers, cafes, and shops. “If cities are to remain viable places for people to develop the strong associational and social life fundamental to healthy human existence they must incorporate a range of public spaces and ‘third’ places outside of work and home, in which urban citizens can come together,” writes John Bingham-Hall, a researcher at London School of Economics and Political Science.

I’ll throw out two counterpoints that might lessen the concern:

  1. While new technology could move us toward more private lives, it doesn’t necessarily have to. We don’t have to end up in a futuristic setting and narrative as depicted in Her. Such claims have been made for centuries with the spread of industrialization and urbanization: new technologies would reduce the humanness of life. Think of the Luddites and their concerns about changes to manufacturing in the early 1800s. Marx was also worried about the alienation being brought about by the forces of industrialization and urbanization. At the same time, we could theoretically end up with more time for social interaction if these new technologies free us up. We’ve heard these promises for decades: people won’t have to work as much or take care of their possessions because it can be done for them. (Put it this way: what does it say about us that even though we have devices to help us reduce our labor, we continue to labor a lot? Are we trying to escape more social interaction?) I would ask: are we blaming the technology too much or should we think harder about how we could utilize what has been invented for our common good?
  2. Early sociologists were concerned about the individual being lost in the big cities of the modern world or noted that city life was a major change from small village life to which many in the world had grown accustomed. (See the work of Simmel, Durkheim, and Tonnies.) Yet, cities continue to attract people and social life continues – even if it has changed in certain ways. Still today, it seems that it might be important that people are around other people regularly (which commonly happens in dense cities), even if they don’t have strong relationships with many people. I would ask: is it really cities that are in danger of being lonely places or would the technology affect everyone in similar ways in coming decades?

Smart cities don’t have to be lonely cities. We could be lonely all over the place or we could make decisions about how to direct technology toward things we might want (such as increased or deeper social connections).

Monorails as a vision of the future

“What I’d say?” “Monorail!” “What’s it called?” “Monorail!” “That’s right – monorail!” I was reminded of this classic parody of The Music Man when I ran into this brief review of a new book looking back at Seattle’s attempt to build a monorail:

“Rise Above It All” by Dick Falkenbury (Falkenbury Enterprises, $14.36). The Seattle resident writes about his effort to establish a 40-mile monorail system. He describes it as a cautionary tale about “a city that once led the way.”

Read an overview of the Seattle Monorail Project here.

While all of this seems quaint – as does the monorail that takes you from the Disney World parking lot to the front gates of the Magic Kingdom – it is always interesting to consider what people in the past thought the future would be like. A quiet and elevated form of mass transit was an exciting possibility in the post-World War II era. Or perhaps we should have flying cars by now (everyone seems to remember this idea) or life should look like that of The Jetsons. But, what do we now think about the future that will look similar absurd in a few decades? The key to these follies doesn’t seem to be whether the technology is possible but whether it is worthwhile to put the new technology into widespread use. Monorails are not that difficult to build but aren’t necessarily much better than other forms of transportation. Flying cars are doable but can they be practical? It might be Google Glass or space elevators or driverless cars.

Music has gotten louder not to drive sales but because artists want it that way

Recorded music today tends to be loud – and this is what many artists want:

The problem with Katz’s pronouncement, though, is that the market doesn’t incentivize loudness in the first place. Studies have shown that there is no correlation between volume and sales. Broadcast radio, where the competition for loudness might be most fierce, already clips the audio waveform at a certain level to avoid conflicts with advertisements and speech. Many cloud music services like Rdio and Spotify already have volume adjustment logic built in with no noticeable effect on recording trends. Low-fidelity loudness has succeeded and survived for some time without much outcry from the public, just from the small population of audiophiles and sound engineers.

The truth is that artists and engineers make their music loud because they want to. And the desire to do so usually correlates more with trends in technology than with commercial concerns. From gramophones to electric playback of records and digital technology, a series of short-lived fads have sprung up wherein musicians abuse new listening mediums to make their songs as loud as possible to the detriment of fidelity. In a paper for the journal Popular Music, Kyle Devine reviewed the long history of feuds over formats and electrical amplification for attention:

The history of sound reproduction can be understood as a history in which auditory ideals and practicalities are in constant negotiation, where the priorities of audiences and “audiophiles” drift in and out of synch…

And something similar is happening now in pop music as more songs that aren’t in the vein of screaming punk choruses make their way onto the charts. While not high fidelity, groups like Adele and Mumford & Sons are easing away from the volume ceiling with moments of quiet that are actually, technically, quiet.

We’ll see what happens in the latest installment of the loudness wars. There appears to be an interesting interplay between what is possible technologically, what artists want to try (and this varies quite a bit by genre), and what the public wants to listen to. From a production perspective in the sociology of culture, technology is the important part because that is what drives tastes. Flip the question around and we could ask whether punk rock would have emerged as it did without the technological ability to simply play loud.

I wonder if another reason is the uptick in headphone/earbud usage throughout the day which really began in force during the 1980s with the Walkman which was followed by the Discman which was followed by mp3 players/phones. While walking around and with lower quality headphones, particularly ones that don’t block out other noise or cover the whole ear, quiet songs are difficult to hear.

College change: syllabi requiring students to check email every day

As technology shifts, college syllabi must as well: there are syllabi that ask students to check email each day.

How to get students, some of whom consider their school e-mail accounts so irrelevant that they give their parents the passwords, to take a look?

At the University of Southern California, Nina Eliasoph’s Sociology 250 syllabus reads: “You must check e-mail DAILY every weekday,” with boldface for emphasis…

When job offers arrive, Ratliff often has excited students turn up in her office only to realize they have forgotten a form they need to send to the company. Using e-mail to get the form or to send it apparently does not cross their minds.

“Some of them didn’t even seem to know they had a college e-mail account,” May said. Nor were these wide-eyed freshmen. “This is considered a junior-level class, so they’d been around.”

That is when he added to his course syllabuses: “Students must check e-mail daily.” May said the university now recommends similar wording…

 

The next step would seem to be having students and faculty and college staff all start using text messages or social media. However, this leads to other issues. Asking people to switch to new technologies which could then require training and practice. Privacy concerns could arise, particularly compared to more impersonal emails. There might be the argument that doing this means getting on a technology treadmill that goes faster and faster – students switch to the next big thing and everyone else must follow.

Another interesting question to ask is what kind of interaction aided by technology best leads to improved learning outcomes? Needing to communicate information is important but what exactly boosts learning? In The Dumbest Generation, Mark Bauerlein argues new technologies don’t typically boost learning even as they might improve engagement. Yet, colleges are moving to moving to more online learning. This can lead to learning at different paces, cuts down on costs, and makes classes available to more people. But, does it lead to more learning?

A summary: “driverless cars are ‘probably’ legal”

An economist takes a look at existing law and argues driverless cars are probably legal:

Over at the blog Marginal Revolution, economist Tyler Cowen points to a recent research paper by Bryant Walker Smith, a fellow at Stanford Law School, who has made the legality of driverless cars his bailiwick. In offering “the most comprehensive discussion to date of  whether so-called automated, autonomous, self-driving, or driverless vehicles can be  lawfully sold and used on public roads in the United States,” Smith argues that driverless cars are “probably legal.” He concludes [PDF]:

Current law probably does not prohibit  automated vehicles — but may nonetheless discourage their introduction or complicate their operation.

Unlike many journalists and policy-makers, Smith begins his analysis with a presumption of legality instead of illegality. “Until legislators, regulators, or judges definitively clarify the legal status of automated vehicles, any answer is necessarily a guess,” he writes. Smith’s own guess turns on three “key legal regimes”: the 1949 Geneva Convention on Road Traffic, National Highway Traffic Safety Administration regulations, and vehicle codes in the 50 U.S. states.

Smith doesn’t think that any of these regimes expressly prohibits driverless cars. The Geneva Convention says a driver must be able to control a vehicle at all times, but that stipulation is probably satisfied if a human can override the automatic operation. N.H.T.S.A. rules don’t explicitly rule out driverless cars either — though an odd rule saying hazard lights must be “driver controlled” might be a sticking point.

States codes, meanwhile, “probably do not prohibit” driverless cars in Smith’s mind, but they do complicate the situation. Right now these codes all naturally presume the presence of a human driver; in New York, for instance, there’s a rule that drivers must keep one hand on the wheel at all times (who knew?) that could become a problem in an automated-vehicle world. Additionally, laws dictating a certain following distance might interfere with algorithms that keep driverless cars close together on the road.

Sounds like an interesting loophole – why worry about whether it is legal when you can instead ask whether it is illegal? I still think a lot of the issue with driverless cars comes down to people, both “drivers” (now people who can override the car’s autopilot when they want) and other people on the road around the driverless cars, adjusting to the change. If it is like other modern technologies, like smartphones, and drivers realize they might be able to do other things while driving, perhaps the switch may be quick.

Another thought: could driverless cars and electric cars end up prolonging and even extending urban sprawl? If commuting is easier and consumes fewer resources (still debatable considering what it takes to produce batteries), why not continue it?

Are we closer to the end of the era of the car than the beginning?

One academic argues we are getting closer to the end of automobile era:

This prediction sounds bold primarily for the fact that most of us don’t think about technology – or the history of technology – in century-long increments: “We’re probably closer to the end of the automobility era than we are to its beginning,” says Maurie Cohen, an associate professor in the Department of Chemistry and Environmental Science at the New Jersey Institute of Technology. “If we’re 100 years into the automobile era, it seems pretty inconceivable that the car as we know it is going to be around for another 100 years.”

Cohen figures that we’re unlikely to maintain the deteriorating Interstate Highway System for the next century, or to perpetuate for generations to come the public policies and subsidies that have supported the car up until now. Sitting in the present, automobiles are so embedded in society that it’s hard to envision any future without them. But no technology – no matter how essential it seems in its own era – is ever permanent. Consider, just to borrow some examples from transportation history, the sailboat, the steamship, the canal system, the carriage, and the streetcar…

“The replacement of the car is probably out there,” Cohen adds. “We just don’t fully recognize it yet.”

In fact, he predicts, it will probably come from China, which would make for an ironic comeuppance by history. The car was largely developed in America to fit the American landscape, with our wide-open spaces and brand-new communities. And then the car was awkwardly grafted onto other places, like dense, old European cities and developing countries. If the car’s replacement comes out of China, it will be designed to fit the particular needs and conditions of China, and then it will spread from there. The result probably won’t work as well in the U.S., Cohen says, in the same way that the car never worked as well in Florence as it did in Detroit.

In our modern world, 100 years is a long time for a technology to hold on. While I imagine there is some technology that would be better than cars, it is harder to imagine the complete overhaul that would have to take place to replace the car. What happens to all of the roads and asphalt? What happens to the garage which has become a more prominent feature of houses? What happens to cities that based their planning around the most efficient pathways for cars? What about the oil industry and auto makers?

Cohen also notes that change could come from China. What if end up in a world where certain countries use a replacement technology for cars because of its efficiency, their larger populations, etc. while wealthier countries like the United States retain their use of the automobile?

Of course, Cohen is correct to note that it is hard to see the future from the present. This may seem like a very silly discussion looking back several decades from now…