‘In New York, Real Estate Is a Blood Sport’

030507 article sitdown ‘In New York, Real Estate Is a Blood Sport’Location: What sort of reaction have you gotten from New York brokers about the $10 fee for placing a rental ad, which you instituted more than six months ago now?

Newmark: Not too much, which is good. They asked for it. They thought it would clean up the site, eliminate all of the repostings. Since we started, the volume dropped precipitously. It is back up a little, but it eliminated a lot of the scams I was worried about, because a lot of the small brokers—the new ones—they don’t earn a lot of money, and they are not getting reimbursed for advertising costs. But when I asked them, ‘O.K., well, what did you do before, how did you advertise before?’—well, there was no good answer.

I brought along a printout from some ads. You can see, here and here, there is the same ad, posted within two days of each other. Can you tell me: Was that broker paying $10 each time, or did they get around it somehow?

It looks like it’s the same apartment. I would say that broker is not making the best use of money. It’s not a broker that I have heard of, so that is a good sign. But tell me, does that price look too low to you?

$1,300 for a one-bedroom in the South Slope? No. So you are saying that it’s not a scam?

Right. I mean, I don’t know. Is it too low?

Not necessarily. About fraud, last fall the City Council released a report saying that one-third of postings that were supposedly no-fee places really did have brokers’ fees. What are you doing about that?

Well, a lot of what I did was get together with the Council, and looked at their list, and I could tell them, ‘Well, that agency is generally trustworthy, and maybe they just had a new broker,’ or ‘This one we know is problematic.’

See, it depends whether problems occur offline or online. We can handle the problems that occur online, but when they happen offline—when people bait and switch, or when they say there is no fee but then, when everybody gets ready to sign the lease, the broker says, ‘Oh, by the way, there is a fee’—we don’t have control over that.

I mean, I guess we could implement some sort of e-mail tracking system, but that is more expensive, and [it’s] less expensive keeping track of it in my head.

Do you mean that here you are, a new-media company using a high-tech platform, and you find that you do better using your noggin?

Well, we are not really that high-tech of a company. I mean, we use computers, but the interface is fairly simple. I can imagine that there may be a way to track scams using I.P. addresses or e-mail addresses, but I actually find that we have done a pretty good job ourselves and through reader feedback. We can see scams develop and address them that way.

You made a distinction between online and offline scams. Do you feel a responsibility for preventing scams that happen offline?

I don’t know if “responsibility” is the right word. I think it is the right thing to do. But we don’t have the boots on the ground to go out and investigate them. And so we cooperate with the NYPD, we are working with the City Council, we are working with the Department of State, which has oversight over licensing in New York.

We feel very strongly about civil rights—but if the right procedures are followed, we also believe in cooperating with law enforcement.

How important is New York real estate to your site?

In New York, real estate is a blood sport. It has always been that way. A few years ago, I started to notice that it was a problem, that we were getting a lot of complaints about [fraudulent ads]. So it is a special focus of mine.

New York is the only city where we have the $10 listing fee for brokers. In terms of time, I would say I spend maybe 20 to 30 minutes a day dealing with New York real-estate problems. A lot of what I do is make sure the right person is taking care of the problem.

Are there things that brokers or newspapers, with their classified apartment ads, can learn from Craigslist?

I think there are issues about using Web sites that they can learn, such as keeping them simple and fast. On a deeper level, I think it is important that you want to treat people the way that you want to be treated. That is very important for a business.

Do you have any advice for how brokers should write ads on Craigslist?

Just cut down the hype. Just be on the level, be as straightforward as possible and include all the facts, and just talk to people like they were really people.

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