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Google invests $50M in Auction.com: good for Google, bad for consumers?

(Tech News) Auction.com has recently seen a fat cash infusion from Google, and both seek to revolutionize real estate. Again. But who really benefits from this investment, and is it at the cost of consumers?

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Google Capital Invests Big Bucks in Auction.com

The online real estate auction site, Auction.com, landed a monstrous investment from Google Capital. In a press release on the Auction.com website, the largest online auction site for buying a selling homes announced that Google Capital invested $50 million dollars in their Irvine, California-based company.

According to the Jeff Frieden, CEO and Co-Founder of Auction.com, “Google is the world’s greatest Internet company and we’re thrilled to have the opportunity to work closely with them. This will give us an opportunity to tap into their deep expertise in digital marketing and mobile, as well as in building world-class products.”

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In speaking about their decision to extend funding, Google Capital Partner David Lawee is equally enthusiastic. He states, “We think Auction.com can fundamentally change how real estate, and particularly commercial real estate, can be bought and sold, leveling the playing field for smaller investors.”

Since Google is widely recognized as a forward-thinking business leader, one might want to take stock in their decision to back such a company.

Real Estate Consumers and Professionals May Want to Take a Second Look

While this cash infusion may lead to some fundamental changes in how real estate is bought and sold, Auction.com currently has some noteworthy practices.

Nationstar Mortgage Short Sales

One of the largest contributors of properties to the Auction.com website is Nationstar Mortgage. Nationstar requires borrowers who want to sell their homes as short sales to auction those properties through the Auction.com website, and this process is not without its criticism.

For one, the Nationstar/Auction.com process is a little bit disjointed. A real estate agent lists a property, obtains an offer, and submits the paperwork (including the fully executed purchase contract) to Nationstar. Nationstar then requires the property to be listed on the Auction.com website, and the bidding on this property is now open to the public.

Many agents complain that this process completely ignores the existing purchase contract between buyer and seller. Given the fact that the seller (not the bank) is the rightful owner until the property, it is the seller who should determine the best purchase offer on the property. The existing contract should not be ignored.

Auction.com Surcharge

Another hot button issue for consumers is that Auction.com requires a surcharge when you purchase a property through their site. For some properties, the surcharge is $2500. But, for those short sale properties that came via Nationstar bank, the surcharge is 5 percent. So, if you bid $250,000 for a property listed on the site, your total purchase (excluding settlement fees) could be $262,500. In effect, homebuyers may end up overpaying for a property.

Possible Price Inflation

Most consumers have the impression that an “auction” begets a deal. In some instances, that may be the case. However, in an auction, people bid against one another and that raises the price, often even causing a buying frenzy, which clearly works to the benefit of the seller.

Elizabeth Story, a San Diego County Realtor® at Allison James Estates & Homes, points out the following unfair consumer practice: “Auction.com’s properties listed for sale have unpublished reserves that allow the seller to decline the transaction, even if you are the winning bidder. In order to encourage bidding up to the unpublished reserve, Auction.com will bid against buyers in its own auctions.” It’s true that Auction.com does not publish their reserve amounts on their site, unlike other sites (such as ebay) where the reserve is visible to the consumer.

But, unlike other auction sites, Auction.com does actually reserve the right to bid against the consumer. In their Reserve Auction Terms and Conditions, Auction.com states, “The starting bid is not the Reserve Price. Except where prohibited by law, during a live bidding event (online or otherwise) the Auctioneer may open bidding on any Property by placing a bid on behalf of the Seller and may further bid on behalf of the Seller up to the amount of the Reserve Price by placing successive or consecutive bids for a Property, or by placing bids in response to other bidders.”

Homebuyers need to understand that the Auctioneer may be bidding against them and, as a result, inflating the price paid to the property to their own benefit and the benefit of the seller.

Online Bidding May Benefit Sellers

The truth is that the online bidding process may also benefit those home sellers that list their homes for sale on the site. In situations of properties where there has been limited interest at the local level through common real estate advertising practices, sellers may be able to increase their buying pools. In the example of luxury homes valued in the millions of dollars, widening the buying pool could possibly lead to a quicker closing.

Thinking of buying a home on Auction.com? Think that if it’s good for Google, it’s good for me? “It’s important to know the facts,” Story says. “Buyers need to know that they are not shortchanging themselves.”

It’s true that the online real estate auction site may have some good features, but as always… caveat emptor!

Melissa Zavala is the Broker/Owner of Broadpoint Properties and Head Honcho of Short Sale Expeditor®, and Chief Executive Officer of Transaction 911. Before landing in real estate, she had careers in education and publishing. Most recently, she has been able to use her teaching and organizational skills while traveling the world over—dispelling myths about the distressed property market, engaging and motivating real estate agents, and sharing her passion for real estate. When she isn’t speaking or writing, Melissa enjoys practicing yoga, walking the dog, and vacationing at beach resorts.

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8 Comments

8 Comments

  1. Missy Caulk

    March 10, 2014 at 12:15 pm

    Thanks Melissa, I tried to use it for myself for a condo in TN. I sat there and watched the bids go up. The scary part of your post is that they can bid up the price. There was a discussion on FB about this a few days ago and most folks said the paper work was horrendous. Makes me concerned for the consumers.

  2. Nick Fisherman

    March 11, 2014 at 1:00 pm

    I am a 26 year old bachelor with no kids. I have no current plans to buy a home. But, my philosophy has pretty much always been “if it’s Google, it’s better.” Apparently, that is no longer valid. Thank you so much for this enlightening article. I will stay away from Auction.com.

  3. Chris Wilkenson

    March 11, 2014 at 2:51 pm

    In theory, if the seller’s reserve is not met by the market, then the
    seller will not sell the property. That same concept holds true on ebay,
    where there is a reserve and if it’s not met then the product doesn’t
    sell. So what’s the difference is the seller bids up to the reserve or
    doesn’t? The same theoretical framework holds true. I feel this article
    is a misinformed, judgmental piece based on analogous insight that’s not
    actual validated through a conceptual framework. Stay away from
    publishing such opinion with such assertion and matter-of-fact
    confidence.

    • Kumar

      April 11, 2014 at 1:14 pm

      What if the buyer made the last bid (which was inflated by auction.com) and puts it over the reserve price?

  4. Maryann Little

    March 11, 2014 at 4:27 pm

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Tech News

Experts warn of actual AI risks – we’re about to live in a sci fi movie

(TECH NEWS) A new report on AI indicates that the sci fi dystopias we’ve been dreaming up are actually possible. Within a few short years. Welp.

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Long before artificial intelligence (AI) was even a real thing, science fiction novels and films have warned us about the potentially catastrophic dangers of giving machines too much power.

Now that AI actually exists, and in fact, is fairly widespread, it may be time to consider some of the potential drawbacks and dangers of the technology, before we find ourselves in a nightmarish dystopia the likes of which we’ve only begun to imagine.

Experts from the industry as well as academia have done exactly that, in a recently released 100-page report, “The Malicious Use of Artificial Intelligence: Forecasting, Prevention, Mitigation.”

The report was written by 26 experts over the course of a two-day workshop held in the UK last month. The authors broke down the potential negative uses of artificial intelligence into three categories – physical, digital, or political.

In the digital category are listed all of the ways that hackers and other criminals can use these advancements to hack, phish, and steal information more quickly and easily. AI can be used to create fake emails and websites for stealing information, or to scan software for potential vulnerabilities much more quickly and efficiently than a human can. AI systems can even be developed specifically to fool other AI systems.

Physical uses included AI-enhanced weapons to automate military and/or terrorist attacks. Commercial drones can be fitted with artificial intelligence programs, and automated vehicles can be hacked for use as weapons. The report also warns of remote attacks, since AI weapons can be controlled from afar, and, most alarmingly, “robot swarms” – which are, horrifyingly, exactly what they sound like.

Read also: Is artificial intelligence going too far, moving too quickly?

Lastly, the report warned that artificial intelligence could be used by governments and other special interest entities to influence politics and generate propaganda.

AI systems are getting creepily good at generating faked images and videos – a skill that would make it all too easy to create propaganda from scratch. Furthermore, AI can be used to find the most important and vulnerable targets for such propaganda – a potential practice the report calls “personalized persuasion.” The technology can also be used to squash dissenting opinions by scanning the internet and removing them.

The overall message of the report is that developments in this technology are “dual use” — meaning that AI can be created that is either helpful to humans, or harmful, depending on the intentions of the people programming it.

That means that for every positive advancement in AI, there could be a villain developing a malicious use of the technology. Experts are already working on solutions, but they won’t know exactly what problems they’ll have to combat until those problems appear.

The report concludes that all of these evil-minded uses for these technologies could easily be achieved within the next five years. Buckle up.

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Tech News

Daily Coding Problem keeps you sharp for coding interviews

(CAREER) Coding interviews can be pretty intimidating, no matter your skill level, so stay sharp with daily practice leading up to your big day.

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Whether you’re in the market for a new coding job or just want to stay sharp in the one you have, it’s always important to do a skills check-up on the proficiencies you need for your job. Enter Daily Coding Problem, a mailing list service that sends you one coding problem per day (hence the name) to keep your analytical skills in top form.

One of the founders of the service, Lawrence Wu, stated that the email list service started “as a simple mailing list between me and my friends while we were prepping for coding interviews [because] just doing a couple problems every day was the best way to practice.”

Now the service offers this help for others who are practicing for interviews or for individuals needing to just stay fresh in what they do. The problems are written by individuals who are not just experts, but also who aced their interviews with giants like Amazon, Google, and Microsoft.

So how much would a service like this cost you? Free, but with further tiers of features for additional money. Like with all tech startups, the first level offers the basic features such as a single problem every day with some tricks and hints, as well as a public blog with additional support for interviewees. However, if you want the actual answer to the problem, and not just the announcement that you incorrectly answered it, you’ll need to pony up $15 per month.

The $15 level also comes with some neat features such as mock interview opportunities, no ads, and a 30 day money back guarantee. For those who may be on the job market longer, or who just want the practice for their current job, the $250 level offers unlimited mock interviews, as well as personal guidance by the founders of the company themselves.

Daily Coding Problem enters a field with some big players with a firm grasp on the market. Other services, like InterviewCake, LeetCode, and InterviewBit, offer similar opportunities to practice mock interview questions. InterviewCake offers the ability to sort questions by the company who typically asks them for that individual with their sights targeted on a specific company. InterviewBit offers referrals and mentorship opportunities, while LeetCode allows users to submit their own questions to the question pool.

If you’ve really got your eye on the prize of receiving that coveted job opportunity, Daily Coding Problem is a great way to add another tool in your tool box to ace that interview.

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Tech News

Quickly delete years of your stupid Facebook updates

(SOCIAL MEDIA) Digital clutter sucks. Save time and energy with this new Chrome extension for Facebook.

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When searching for a job, or just trying to keep your business from crashing, it’s always a good idea to scan your social media presence to make sure you’re not setting yourself up for failure with offensive or immature posts.

In fact, you should regularly check your digital life even if you’re not on the job hunt. You never know when friends, family, or others are going to rabbit hole into reading everything you’ve ever posted.

Facebook is an especially dangerous place for this since the social media giant has been around for over fourteen years. Many accounts are old enough to be in middle school now.

If you’ve ever taken a deep dive into your own account, you may have found some unsavory posts you couldn’t delete quickly enough.

We all have at least one cringe-worthy post or picture buried in years of digital clutter. Maybe you were smart from the get-go and used privacy settings. Or maybe you periodically delete posts when Memories resurfaces that drunk college photo you swore wasn’t on the internet anymore.

But digging through years of posts is time consuming, and for those of us with accounts older than a decade, nearly impossible.

Fortunately, a Chrome extension can take care of this monotonous task for you. Social Book Post Manager helps clean up your Facebook by bulk deleting posts at your discretion.

Instead of individually removing posts and getting sucked into the ensuing nostalgia, this extension deletes posts in batches with the click of a button.

Select a specific time range or search criteria and the tool pulls up all relevant posts. From here, you decide what to delete or make private.

Let’s say you want to destroy all evidence of your political beliefs as a youngster. Simply put in the relevant keyword, like a candidate or party’s name, and the tool pulls up all posts matching that criteria. You can pick and choose, or select all for a total purge.

You can also salt the earth and delete everything pre-whatever date you choose. I could tell Social Book to remove everything before 2014 and effectively remove any proof that I attended college.

Keep in mind, this tool only deletes posts and photos from Facebook itself. If you have any savvy enemies who saved screenshots or you cross-posted, you’re out of luck.

The extension is free to use, and new updates support unliking posts and hiding timeline items. Go to town pretending you got hired on by the Ministry of Truth to delete objectionable history for the greater good of your social media presence.

PS: If you feel like going full scorched Earth, delete everything from your Facebook past and then switch to this browser to make it harder for Facebook to track you while you’re on the web.

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