Category: 2007 July

The Luck of the Irish

July 31st, 2007 by Steve Gordon

The “Luck of the Irish” my grandfather used to say. He used the phrase to describe the unfortunate (though often funny) things that happened in his life. Recently, I’ve used it to describe my experience as a seller in this part of the real estate cycle. After a long year, my wife and I finally sold our home. The selling price was 24% below our original asking price. It was also 41% above our total investment in the house. We owned the property for only five years. That’s an 8% annual return on an investment that also provided us shelter and enjoyment.

I actually feel quite lucky. We beat the long-term U.S. average of 7% annual appreciation in home value–in a down market. In an ultra-low risk investment, like a home, that’s quite good.

The problem with most sellers today, is that they still think it’s 2004, and they are priced accordingly. Similar homes in my old neighborhood are still listed 50% to 75% higher than our selling price. In my view these owners aren’t really selling, they’re just publishing their “I’ll move for this…” number. These people distort the numbers of homes on the market and the pace of inventory turnover. The market’s tough, but dillusional sellers make things look much worse than reality.

The problem with such unrealistic pricing in the market, is that potential buyers see it and sit on the sideline waiting for prices to drop back to Earth. Thus the cycle is prolonged. It’s the luck of the Irish!

Wall Street Journal Talks “Mash-Ups”

July 3rd, 2007 by Steve Gordon

In today’s Wall Street Journal, Lee Gomes talks about mash-ups moving from recreational use to real business solutions. He interviews Mark Lynd, president of Firescope, Inc. who explains the value of mash-ups:

“What’s interesting with this [mash-up] model is that all of these mash-ups could be created at very low cost and resources. That makes features that were traditionally only affordable by large corporations available to small businesses.”

We couldn’t agree more!

He goes on to say…

“The future of mash-ups doesn’t require any new technology, or a radical change in architecture or thinking, like in many previous technology revolutions.”

Mr. Lynd is right, mash-ups don’t require new technology or architecture. They do require significant new thinking. Not new thinking about the hardware and systems, but new thinking and understanding around the way we consume information.

Mash-ups are valuable because you can bring separate data together. If the mash-up is done well, the combination of data gives you understanding and knowledge not available before.