Artificial Intelligence and Real Estate

Everyone is coming to grips with this new technology and how it will be applied to real estate. Here is a fascinating article on a practical application actually developed here in Las Vegas!

I even used AI to translate that dialogue into this paragraph. I edited it down a bit because I find AI is a little too wordy:

This first conversation interface  emphasizes the fusion of technology and tradition in the real estate sector. Unlike conventional platforms, this system offers a personalized experience, revolutionizing the property hunting process. Users can simply engage in conversation to specify their requirements, such as the type of home, location, and budget. The AI swiftly sifts through vast databases to present tailored options, eliminating the need for exhaustive searches through listings or photographs.  Overall, the conversational AI promises to revolutionize luxury real estate by providing efficient, personalized, and comprehensive assistance to qualified buyers.

Today, we are using AI to translate old MLS descriptions with our current rental inventory. I know that’s not an earth shattering application but it’s an example of how little things add up to saving time. We are embracing this new technology and will keep learning how we can apply it to our business.  

Rental Market – By Bob Kinniburgh

According to Zillow, the single-family house rental market continues to show rent growth in the first two months of 2024. The median rent for Las Vegas grew to $2,380, up from $2,275 a year ago. North Las Vegas has been up and down for the first quarter reporting and saw their median rent hold steady from $2,000 to $1,995, year over year. Henderson single-family homes pulled back from the strong February showing in March to lower their median rent to $2,195. Still ahead of last year by $160 though.

 

 

 

 

In the Zillow reporting, they combine apartments with condos, so the information is somewhat difficult to separate. We can ascertain the trends, however. For Las Vegas, the apartment/condo rental market slowed in rents from a median of $1,408 in March of 2023 to $1,330. North Las Vegas continues to see pressure on apartment/condo rental. The median rental lowered to $1,392 from $1,536 a year ago. In Henderson, the market median rent for apartments/condos dropped from $1,710 to $1,502.

Overall, we continue to see weakness in the rental market year after year. We expect to see some positive movement with rents as we enter the high-demand season for single-family homes, but apartments/condos will continue struggling to reach the highs of last year’s rents.  Here is an amazing tool that allows you to put in a zip code to see trends.

$418M Settlement with National Association of Realtors

Our national association just got their clock cleaned by some clever attorneys.  Thousands of agents in Las Vegas are already suffering from lack of inventory. This settlement is  another attack on real estate commissions because many people believe real estate agents are sitting around drinking mimosas and chatting about their dog’s next birthday party. 

All the big brokerages on the West Coast are scrambling to figure out how to put the commission burden on the buyers.   Brokerages on the east coast already put commissions on the buyers.  This commission distribution will make it even more difficult for first time home buyers and real estate agents. There is some discussion about folding that commission into the mortgage. The end result will be more consistency of commission distribution.  In the meantime, a lot of agents in Las Vegas are folding and going back to 9 to 5 jobs. Larger brokerages are scaling down to adjust to the sudden drop in earnings.

Limestone Investments is somewhat immune to all this drama. We have very little overhead: our building is paid off, we have no employees, no fancy furnishings and our agents earn the majority of their income from managing properties. Our biggest expense is accounting which scales to the proportion of our business. If one of our tenants or investors does a transaction, that’s icing on the cake for one of our property managers. We have been through a lot of real estate storms and this is nothing. 

Limestone Investments Legacy

We have been pondering the our destiny of Limestone Investments for the past few years. My father’s recent passing has really made an impact on my thinking. Here is a picture of my dad who taught me how to be kind to others and  to be calm in the face of chaos. I’m sharing my pain because I would like everyone to think about creating their own legacy now.

 

 

 

 

Most “mom and pop” real estate companies fold if the broker dies suddenly. The broker next door just died of heart attack. That brokerage is done. Those agents and clients are simply cast adrift. That was another wake up call and we don’t want that to happen to our clients. A broker dying suddenly is a rare event. In most cases, the brokerage is sold off to another company where it just gets folded into some other larger company. Clients are stuck with the some 12 year old who doesn’t have a clue on how to manage a property. We don’t want that happening to our clients either!  I will be turning 60 next week and this is our succession plan:

Jim Eagan dies suddenly.  Bob Kinniburgh will take over property management operations and Barb Eagan will continue managing short term rentals.  They will determine the next captain.

Jim Eagan fades into the Sunset.   As time goes on, I will manage fewer and fewer clients. In about ten years, one of our amazing new property managers will emerge and have the experience to take over the helm as the designated broker. My plan is to continue managing a handful of clients until I check out.

Every week, I spend time teaching our managers on how to operate this business. We believe that everyone should have the skills and knowledge to run some part or all of Limestone Investments.  I have spawned 3 brokers/competitors so this concept isn’t new. The next captain of Limestone Investments will have my knowledge and more. Our managers are gaining experience while I guide them through rough waters.  Everyone here at Limestone Investments is passionate about this profession.  We have a plan to carry on that passion for decades to come.