Zillow to Compete with MLS and Realtor.com
Zillow is trying to compete with the Big Boys. The Big Boys in this case are the Multiple Listing Service and Realtor.com. In order to access the MLS in Illinois, a person has to be a licensed Realtor/Broker while Realtor.com is used by consumers looking to purchase homes. The MLS feeds Realtor.com the homes that are currently on the market.
Realtor.com Delays Frustrate Agents, Sellers, and Buyers
There are quite a few problems with Realtor.com. First and foremost, updated information on the website lags behind by up to 72-hours. For example, a house that is posted to the MLS could take up to 72-hours before being posted on Realtor.com. Realtor.com also charges the real estate agent membership fees to post a listing to their site. The site adds additional charges if the agent would like to display interior photos.
Are “Zestimates” Ze Truth?
These charges led many agents to turn to Zillow. Zillow was a free web site that offered what they termed a “Zestimate” or a desk top appraisal. They pulled data from several sites that included Realtor.com and county assessor offices. Zillow also relied on the seller’s agent to be honest with the closed sales prices of the homes. In slight contrast, the MLS requires all agents to input the true closed sale amount. Illinois state license law requires that agents post the true sale amount. Zillow, however, does not. Oftentimes one would find a “Zestimate” to be off the market value by thirty to forty percent. These “zestimates” lead the seller into having false expectations of their property value.
I for one was not a fan of Zillow.com but did in fact post listings on their web site. The misleading estimates disturbed me, especially since I am a Certified Appraiser. I then had to explain over and over again to my clients as to why it was so misleading.
Zillow to Charge Featured Listing Fees
Yesterday, I received an email from Zillow that asks for a Featured Listing fee but does little to address the misleading estimates on their site. The e-mail read in part:
Beginning today, in order to post a home for sale on Zillow, you can either buy a Featured Listing for $9.95 per listing for a 180-day period, or, if you have 50 or more listings, you can send us a listings feed, for free. Since you currently have a home posted for sale, your listing will expire on January 13, 2010 unless you extend it by purchasing a Featured Listing. We feel this change will help improve the quality of listings on our site, which will provide a better customer experience for the millions of buyers who visit Zillow each month.
Will Changes to Zillow Affect Quality of Listings?
I truly look forward to watching what will happen next. I predict that by this time next year, Zillow will offer to list properties for free again. What do yo think?