Zillow.com Now Posting Homes For Sale in Austin

by Steve Crossland, REALTOR in Austin TX on December 8, 2006 · 9 comments

Zillow.com, the website that provides “Zestimates” of home values for properties in the U.S. has now enabled new features that allow homes to be listed for sale. This is the next logical step for Zillow as they try to gain a foothold as the place to go for home information. More on that later.

For Sale listings can be entered both by home owners and also by Listing Agents. Oddly, there is also something called “Make Me Move”, where owners can “tell others the price you’d be willing to sell your home for, without actually putting it on the market. It’s that magical number you just can’t refuse.” Zillow says, “Once you set your Make Me Move price, potential buyers can contact you anonymously via e-mail. Then it’s up to you whether or not to sell your home.”

I predict the “Make Me Move” feature won’t last long. Every kook in the Country will be placing a MMM price of triple the value of the home and it will eventually turn out that nobody will take it seriously. Also, once Owners realize that 9 out of 10 emails they receive are from people saying “please provide your absolute bottom dollar price and email more pictures”, owners will pull their MMM listings pretty fast. Zillow should just stick to posting homes either for sale or not, and leave out this weird “Make Me Move” category.

But with regard to the For Sale part of it, I decide to enter a listing to see how it works. Here’s how it went.


First, I had to get set up an Agent Profile with Zillow. This took about ten minutes total. Next, I had to find the property I wanted to list. Once I located it, I clicked a tab on the top menu that said “Post For Sale”. Then I followed the prompts to upload some photos, add info about the listing, and agree to some terms and conditions including a pledge that I am in fact the Listing Agent for this property. It also provided a spot to enter the MLS number. This one won’t go into the MLS until next week when the virtual tour and final photos are ready, so I left that blank.

Oh yeah, since the condo I’m listing was shown about 1/2 block from it’s actual location on the Zillow map, I needed to relocate it. Zillow offers this option during the posting process. This turned into an arduous task as each time I “moved” the small “house” icon to its proper location on the map, it would take me right back to where I started at the next screen, showing the location in the original wrong spot and an error message. Eventually, on the 4th try, it worked though. This is a nice feature (I’m sure they’ll iron out the kinks), since I was able to place the icon using an aerial view and locate the icon precisely in the rear building of the complex, where this condo is located.

All together it took about 30 minutes to enter the listing. Quite a long time compared to other places we post listings. It takes about 15 minutes to enter all the data and photos into our MLS system. It takes me about 5 minutes on my own website. I’m sure the next one will go quicker on Zillow though.

At present, there are 4,886 listings posted for sale on Zillow, and now one of them is mine. I don’t think the format presents the data in the most elegant way. I think most people prefer to see all the info in a “flyer” or “listing” type format where your eyes can easily scan a page-sized area for the details of the home without having to hunt and click. Zillow has the data all spread out and you have to click around a bit to find all the info. They do have it right with the pictures though – up top and easy to see and browse.

Will Zillow someday become a primary place where buyers go to look for homes? Will it compete with Realtor.com? Maybe. Eventually. Who knows? Will Zillow help us sell this condo? Well, it can’t hurt. It’s certainly easy to locate.

Go to Zillow.com, type in 78704 on the home page and poof! There are red, blue and yellow flags showing the For Sale, Make Me Move, and Recently Sold homes in and around the 78704 zip code area. Currently, doing a search just for 78704 shows 4 For Sale, 3 Make Me Move, and 160 Recently Sold properties.

For now, Zillow.com is just an interesting place to keep an eye on. Agents will always be needed in many if not most types of real estate transactions. But sites like Zillow, that seek to match Buyers and Sellers for free, are no doubt going to carve a niche for themselves while the slug-footed Real Estate industry and our MLS Organizations try to keep their claim on the ownership of listing data (that us agents provide) and their outdated concepts of doing business. It really irks me that the listings we agents work hard to obtain result in “data” that the MLS then owns and sells to others once we enter it into the MLS system. But that’s another topic for another day.

1 Jim December 10, 2006 at 2:09 pm

Nothing will ever replace the MLS, imho.

First, Zillow will have to control the quality of the data being enter. Just like the ridiculous MMM prices, people can easily lie about any feature of the property. Who’s going to prevent the seller from entering an incorrect sold price to try and inflate property values. At least with MLS, the listing agent gets fined.

Second, there are privacy and security issues. Lockboxes allow tracking of who has seen the property. You can also post comments about children left alone, or dangerous pets, etc.

Finally, IDX software is improving all the time. There are third party solutions that have search by map, ability to save searches and have listings delivered by email. What’s Zillow got that the others don’t? The only thing is the Zestimates that they make such a big deal out of. Those totally useless value estimates that don’t even begin to take into account everything that goes into pricing a property.

2 austinguy December 10, 2006 at 3:29 pm

Steve, don’t be surprised when a bunch of people interested in buying your house show up at your door on April 1st :)

I’m kidding of course, but it’s issues like these that make the Zillow model unworkable. They’ll either have to start charging for the listings, or deal with so much bad data that the listing side of it becomes worthless.

3 Steve Crossland December 10, 2006 at 8:25 pm

Hi Jim and Austinguy,

Points well taken.

But don’t forget, the founders of Zillow.com are the same guys who shook up and essentially destroyed the traditional travel industry model with Expedia.com. There were doubters back then too – i.e. “people are never going to want to sit at computers an book their own airline flights” Well, we see how that worked out.

I know there are huge differences between the services provided by Travel Agents and those provided by Realtors, but the real estate industry’s entrenchement in old-school thinking and their insistance on “owning” and controlling all listing data (once entered into the MLS) is not very enlightened, in my opinion. I don’t feel like the leadership at NAR is getting it right, or even getting it at all with regard to the threat posed by Zillow.com.

Zillow has about 67 of the roughly 70 million U.S. homes already in its database. Any of those homes can be searched and found by anyone. Now Zillow is allowing home owners and listing agents to simply add more information to that database – i.e. – “this home is currently for sale”. I find that very interesting.

We are moving away from the era of agents being the “keepers of the sales listing data” and toward the era of agents being valued more as “facilitators of the deal” and educators. It’s one thing to find a listing online. It’s another to know the detailas of an area, the schools, whether a new freeway is coming three blocks from that home (like a new listing I saw this morning), whether the price is right, etc. Those are the things for which Realtors will continue to be valued.

Steve

4 Joe Sixpack December 11, 2006 at 1:30 am

The sooner the real estate agent cartel is broken the better. I hope zillow.com is successful.

5 austinguy December 11, 2006 at 10:32 am

Steve:

There’s quite a difference between buying a ticket and buying a house. All you do is compare prices, pick your favorite airline or departure time and you’re done. All that travel agents used to do was act as a medium of advertising the fares to the public. The computer technology wasn’t there to do it efficiently. Similarly with stock brokers.

Both stock brokers and travel agents are still alive and well, they just do different things now. There are travel agents who specialize in hard-to-find travel packages, and brokers became financial advisors/portfolio managers.

I don’t think the Realtors insist on guarding data. Let’s not forget, it is OUR data. We are the ones paying MLS dues every month and compiling it. I think the IDX should allow limited sold information to the public. Just enough to give them an idea. It’ll be much more accurate than what Zillow has.

However, the quality control issue is a big one. How do you see Zillow controlling the information? What if the Zestimate is *over* the last sold price and the owner goes in and affirms that that’s the right price. Or like I pointed out, who’ll stop me if I wanted to list your home for sale one day as a prank? The MLS takes a lot of effort and money to maintain the way it is. I don’t see how Zillow can pull it off and still make a profit.

Finally, Zillow now is planning to rely on Realtors for property listings. They know we are the only ones who will put accurate listings out there. But in the end, their goal (see the latest bloodhound post) is to destroy us. Sounds like a case of biting the hand that feeds you.

Joe Sixpack: dream on dude! if you have nothing useful to add, don’t post.

6 Steve Crossland December 11, 2006 at 11:06 am

Hi Austinguy,

> Both stock brokers and travel agents are still alive and well, they just do different things now.

And there are way fewer of them. I think we’ll be doing the same things as Realtors, but in a different way. Our Value Proposition will have to change somewhat.

> What if the Zestimate is *over* the last sold price and the owner goes in and affirms that that’s the right price.

In reading more blogs about Zillow lately, and hearing what other Realtors as well as non-Realtors think about all of this, I’ve come to realize that most people are more worked up about the “Zestimates” than I am. Agents seem to worry that the “Zestimate” number, if incongruent with a list price, will create problems; making their listing look overpriced or underpriced in comparison. I thought, perhaps incorrectly, that just about everybody knows that the Zestimate numbers are crap. Apparently, the Zestimate number bothers a lot of people. I just ignore it.

Sometimes the Zestimates are close, but I put them in the same category as Tax Appraised Values, which are rough guesses. It’s not a number to be trusted or to be given any consideration whatsoever. (It amuses me what I see listing comments such as “$30K below tax appraised value!” So what?).

> But in the end, their goal (see the latest bloodhound post) is to destroy us.

I’m not so sure about that. They aren’t Brokering deals. They are providing information – albiet some bad information (Zestimates). The actual For Sale listings (not the Make Me Move), the ones represented by agents, introduces truly quality data into their system. Those listings, at least theoretically, have passed through the filter of a licenced agent. The more quality data that is introduced, the more likely it is that the Zestimates will someday reflect something close to reality – especially if sales prices are accurately reported and factored in after homes sell.

Steve

7 Dan K December 11, 2006 at 4:29 pm

I applause the openness of Steve’s attitude. After all, the social force is there, and things are going to happen one way or another. As individuals, you can wish it will never happen, but if you are willing to adjust when the wind start to shift, you will end up on top of the game. The traditional model of real estate business is under much scrutiny lately simply because there are too many people affected and too much money made. While the NAR is a strong powerful lobby group, there’s no 2nd amendment to protect the right of 6% (among other things like house data) in comparison to the NRA. So, instead of taking up the adversary position, an businessman should look further and see if the inevitable change is going to produce new opportunities.

Zillow’s zestimate is very much like a joke right now. However, it’s formula will become better and better with the help of accumulating data and a couple very good statistician. I am not sure if they will eventually reach that goal, but I think they have a shot.

8 Jim December 14, 2006 at 4:19 pm

I don’t think Zillow will ever get anywhere. There are just too many subjective factors that affect home price (quite dramatically sometimes) that Zillow can’t hope to keep track of. Some examples: views, awkward floorplans, bad paint job, weird smells, dirty carpets, trashy neighbors, etc. The price can’t be derived accurately by looking only at the specs of the home such as bedrooms bathrooms and sq.ft.

Also, the data quality issue IS big. I really don’t see how it can be fixed without manual intervention, and that’s going to cost money.

However, what Zillow will do is give NAR and Realtor.com a proverbial kick in the ass. There’s no reason why we, as realtors, can’t provide the same information, only much better. We have access to all the latest accurate data, why not make use of it. Already, guys like Steve are publishing monthly stats, which makes use of sold data. And people can easily find out what’s been selling by requesting a free CMA.

Our value as agents is in the expertise of interpreting that info, not in keeping it hidden. So while Zillow won’t make us go out of business and it’ll never be accurate, it’ll scare the decision makers among Realtors into thinking of new tools to offer buyers.

9 Jim December 14, 2006 at 4:30 pm

Steve, regarding stock brokers/travel agents. Don’t forget that all they ever did was push a button that we called them and told them to push. It was a simple job that got automated.

Not the same for buying a house. Also, notice the proliferation of financial analysts and portfolio managers. Now that everyone has access to this mess of financial data and can trade from home, they suddenly feel overwhelmed and look to someone who is experienced to make sense of it.

Not long ago, many agents complained that displaying IDX listings would drive us out of business. If nothing else, we’re more in need than ever, only now we interpret the data instead of simply giving it out.

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