REALTORS Who Respect Zillow Earn Public Trust

REALTORS, please stop resisting Zillow. They have the trust of the public. Zillow has the power they have because they figured out how to involve the consumer at the REALTOR expense.  Embrace Zillow the way the public does.

Embrace The Zestimate—It’s Your Opening

Given this choice as a customer, who are you more likely to trust and engage in a conversation: (1) The person who tells you you’re wrong, you’re making a mistake, and you’re in danger. (2) The person who compliments you in being proactive, smart, informed, and wise. Number 2 of course. When people recognize our intelligence and wisdom, our opinion of them goes up. Still, when allowed to engage in a real estate conversation when Zillow is the topic, agents tend to go straight to the party line with flawed criticism. Opportunity Lost! 

The wise REALTORs know everything Zillow wants them to know about Zestimates. And they want you to know: Zillow knows the Zestimate is not as accurate as you can be.  Here it is in their own words:  It is not an appraisal and it should be used as a starting point. We encourage buyers, sellers and homeowners to supplement the Zestimate with other research such as visiting the home, getting a professional appraisal of the home, or requesting a comparative market analysis (CMA) from a real estate agent.

https://www.zillow.com/zestimate/ This link takes you to Zillow’s stats for Zestimate accuracy by State. In Wisconsin, Zillow tells us up front, they are accurate within 5% of the sales price 82% of the time. Do you know what they call REALTORS who estimate a home’s value within 5% accuracy 82% of the time? Ex REALTORS. For those who point out Zillow reports that they are within 20% of the correct price, 99% of the time, consider what that means. Zillow will be wrong in every opinion. And the error could be up to 20% of the value. (A $400,000 home with a 20% error is off by $80,000.) 

Consumers Like Opinions that support theirs

Some consumers will look at an explanation of analytics after they see or hear an opinion. But that takes work. A typical consumer looks at their Zestimate and their City Assessment and decides if the number is right or wrong based on how they want the number to factor into a formula. Show me one homeowner who’s Zestimate is higher than their assessment to go into the City and demand their property tax bill to be increased. Should that Zestimate be lower than the assessment, I’m sure the assessor will soon be seeing the Zestimate as evidence. 

Never Right or Wrong…Just a Start

The Zestimate and the consumer are never necessarily right or wrong. The number is a product of analytics but the analytics still require your input. The consumer who begins with Zillow is smart. Being informed is always better than being at the mercy of someone who has an opinion. 

Attempting to undermine Zillow is futile. REALTORS who try only undermine their credibility and that of other real estate professionals. Those REALTORS who learn how Zillow works, why Zillow works, and align themselves on the public’s side with respect to Zillow will be the REALTOR of choice for people who like to be respected. It’s far easier to work with people who respect you, trust you, appreciate you for not criticizing them.   

Facts Matter

Things are better than we think according to the author of  Factfulness   Hans Rosling.

Experience and history influence our feelings, and our feelings contribute to our conclusions. Thinking about situations being better than we think as it’s applied to real estate work, two areas where we go quickly to experience and history are assessing the coming market conditions, and pricing. If Hans Rosling’s theory plays out in our business, our industry’s perspective of the coming market conditions might be less accurate, in a negative way, and our opinions of value may be a bit low when experience is given more value than facts.

What does the real estate industry tell the public every spring? Buy now because interest rates are going up. Sellers? Sell now because the market’s going to take a dip. It’s easy enough to look at the factual historical data and see if we’re right more than not (I think not).

How diligent are we at scrutinizing the facts, as they relate to appraised valuation, when answering a question of our opinion on value? The outcome of a transaction is affected by the conclusions buyers and sellers reach influenced by our opinions. How costly is it to the parties when one of us offers a value opinion based on what we think rather than what we know to be factual? Learning to make value adjustments, and then applying that exercise before speaking might be worth the effort.