Why am I trying to build a “pre-market” for home rentals?

Posted on March 29, 2010. Filed under: JumpPost, startups | Tags: , , , |

Think about any market where inventory isn’t priced perfectly.  The early bird (in this case anyone using JumpPost) who gets to choose before the broader market sees the goods will capture the best deals.  The chump who buys a used car that’s been sitting on the lot for 6 months (the market has seen and passed on it) is obviously not getting the best deal in the market.  In contrast, the used car dealer’s cousin (who gets to see the new stuff coming into the garage before it ever get’s out to the lot) is probably going to do all right.  In a perfectly priced market, there is no such thing as a deal, in which case it does not matter when you gain access to the inventory, but luckily for JumpPost, home rentals exist in an imperfect market.

In home rentals, if you have 10 apartments coming into the market, each unique and priced individually, 1 of those apartments will be an extraordinary deal (the value vastly exceeds the price paid), 3 of those apartments will be good deals (the value exceeds the price paid), 3 of those apartments will be market deals (the value is commensurate with the price paid), and 3 will be bad deals (the value is lower than the price paid).  The numbers in each bucket, are a bit arbitrary, but you get the point.

Currently, if you search on Craigslist or really anywhere else for that matter, 95% of the rental inventory advertised is available to move in immediately or within 30 days.  What this means, is that everyone in the market is competing for the same inventory at the same time.  You’re ability to find an “extraordinary” or even “good” deal is mitigated by the volume of people who are also picking over the same opportunities.  All the good stuff goes immediately, you only have time to view 5 or 6 places before you’re on the street with a suitcase, and invariably you become the asshole who is paying $500 a month more than your best friend who is living in a nicer place than you.  Read: the people getting the “bad” deals are accepting them when they are under pressure from a) competitive renters in the market and b) time pressure due to their own expiring lease.

Now, imagine if you were able to get a sneak preview of everything that was coming onto the market, and there was a magic company that could get you in to view that inventory 30-90 days before the masses of Craigslist started picking through it.  That would be worth something, no?

You bet.  Jumppost strives to be that magic company.  Admittedly, we aren’t magic until we have a TON of apartments for you to browse and discover in our “pre-market.”  We are working on that, but Rome wasn’t built in a day.  If you believe in the mission (and unless you’re a rental broker you should), you are in a perfect position to help us build this “pre-market.”  By creating a post in JumpPost, you are giving your fellow consumers a “heads up” that the place you’re leaving is going to be coming onto the market soon.  You could do this because you’re nice and believe in helping your friends and friends of friends, or you could do this because JumpPost helps you to earn serious money for giving consumers the “heads up.”  Either way…do it.  And if you aren’t in a position to do it, get you’re personal referral code here, post it in twitter/facebook/your blog/email/whatever, and help us move this market for the better.

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One Response to “Why am I trying to build a “pre-market” for home rentals?”

RSS Feed for Jordan Cooper's Blog: startups, venture capital, etc… Comments RSS Feed

I’m hoping you build a premarket because every rental broker i’ve encountered in NYC (i’m up to 5 now) has lied to “help” me get an apartment.

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    I’m a NYC based investor and entrepreneur. I've started a few companies and a venture capital firm. You can email me at Jordan.Cooper@gmail.com (p.s. i don’t use spell check…deal with it)


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