You may have heard that all real estate is local. I know I’ve talked beat the drum about why it’s a good idea to have an experienced, knowledgeable broker to help with pricing and other items important to making a good buying or selling decision.
I think recent events with Zillow and their home buying adventures present a cautionary tale based on exactly these points. Or, as my wife likes to say, “You can either be a good example or a horrible warning.”
Don’t get me wrong, I think Zillow has done a fantastic job of putting together a real estate search app and follow up system that was lacking in this industry. They truly nailed that and captured the market. Whether they got greedy or over ambitious or a combination of both, their ibuying program showed none of the well thought out execution of their marketing platform.
Zillow paused it’s ibuying program at the beginning of November. Reports showed that at the end of the third quarter 9,790 homes in inventory, with another 8,172 homes under contract. They stated they would honor the existing contracts but would not be purchasing any additional homes.
Until this event, I really thought of the zestimate as a gimmick to draw people in and a bit of an aggravation to be honest. It was rarely correct, and I have spent a lot of time digging through Zillow’s data in order to show homeowners where Zillow had gotten it so wrong.
It never occurred to me that this company believed its own hype and was prepared to purchase homes based on these, frequently way off, guesstimates.
Three main things went wrong here. 1. They relied on computer generated pricing without having any direct knowledge of the home or neighborhood. 2. Often, the sellers drawn to this type of quick sale transaction have homes with issues. These may range from repairs and updates to unfixable flaws that make them more difficult to sell. 3. They didn’t have relationships with various local contractors needed to bring the homes they purchased up to par.
Each of these items could be overcome by a local real estate professional. Think I should see if Zillow needs a listing broker?
C. Michael Elliott and Associates is a boutique, privately owned office. Please give us a call if you are considering buying or selling, we’ll explain our services in detail and you can decide if we are a good fit for you.
Michael Elliott has been selling real estate at the Lake of the Ozarks since 1981. He is one of the most respected brokers in the area. If you would like to work with Michael in the sale or purchase of property, or have interest in a career in real estate, contact him at 573.365.SOLD or firstname.lastname@example.org or stop by C. Michael Elliott & Associates, 3738 Osage Beach Parkway.