Zillow's new strategy (percentage, sellers, fees, house value)

[CaptainAaamerica]

I honestly don't think the iBuyer program will be good for real estate agents, sellers, or buyers (investor or end user).

Objectively, they are entering the business of flipping homes but with a business model that does so without the added renos and a focus on either desperate sellers or misinformed sellers (I am sure in 99% of the cases of desperate sellers, they are actually misinformed sellers thinking they are desperate sellers). This model will be very hard to execute on a mass scale, but I guess they have a formula (I assume they are leveraging their risk by low balling sellers much more than a normal flipper would do).

[Brandon Hoffman]

Originally Posted by CaptainAaamerica

I honestly don't think the iBuyer program will be good for real estate agents, sellers, or buyers (investor or end user).
...

The iBuyer will be good for a niche market of buyers that need to meet a time frame more than a price goal, such as a person building a home and needs to control the closing date.

[benfrompropertysimple]

Very interesting perspectives here. I see this movement as just another example of tech automation and removing "the middleman" in order to increase margins. Honestly, I don't see it working well for the clients as the local knowledge of real estate agents is impossible to replace.

[kww]

Originally Posted by AbhilashMishra

mod cut - deleted spam post

thanks!

[AndreaTownsley]

Originally Posted by Grlzrl

I apologize if there is already a thread about this. I couldn't find it.

I was listening to the Zillow CEO talking about their new plan to buy and sell homes and deal with mortgages, title, etc. It's interesting. I am sure many on here will dislike it. They said it won't hurt realtors because if they are in the business, there will still need to be buyers buying homes.

I would love to hear people's thoughts.

Didn’t read the other comments yet but this is common in my area, too. A lot of the bigger brokerages have branched out into adding a mortgage brokerage and also a title agency. It does make sense for Zillow to do more than just what they’re currently doing as part of their income is derived from agents paying for leads from them, and most have caught on that it’s akin to throwing money straight into the trash.

Personally I am all for the way we do real estate evolving into what suits the consumers. After all, my duty is to serve consumers and I can’t stay in business if I’m not doing that. I think it’s interesting, even if I’m not a huge fan of Zillow.

[No signal hill]

I read through postings to learn how Zillow Offer works, but to me it sounds like Zillow is just one of cash offer purchaser then Seller would still want to see other offers. I would think it’s safer to list on mls than just depending on Zestimate.
My condo’s Zestimate is $50,000 less than Redfin estimate. Then, I will contact Redfin...

But as I’m a realtor and premier agent I may jump in as local rep to see how it goes if they accept me at $2000/month spending. I have been spending close to $1500/month anyway for last couple years. I have always been thinking I should have gone to Redfin partner (Not the one hired by Redfin) that would broaden my line of income. It will be similar kind of opportunity.

[MikePRU]

Originally Posted by No signal hill

I read through postings to learn how Zillow Offer works, but to me it sounds like Zillow is just one of cash offer purchaser then Seller would still want to see other offers. I would think it’s safer to list on mls than just depending on Zestimate.
My condo’s Zestimate is $50,000 less than Redfin estimate. Then, I will contact Redfin...

But as I’m a realtor and premier agent I may jump in as local rep to see how it goes if they accept me at $2000/month spending. I have been spending close to $1500/month anyway for last couple years. I have always been thinking I should have gone to Redfin partner (Not the one hired by Redfin) that would broaden my line of income. It will be similar kind of opportunity.

Why not just learn how to generate your own business? Zillow and Redfin are not your friends. They are your competition and you're paying them.

Also, as a real estate agent why would you even consider selling your home to Zillow offers? Between the fees they charge, the lower prices they offer, and the strict post inspection negotiations you would know better than anyone and have the best resources to get a much better price.

[bande1102]

Originally Posted by Silverfall

We had one client that moved here using Zillow's iBuyer program and she said she walked away from $20k for the convenience. I honestly don't know many people that can walk away from that kind of cash so I think iBuyer will have a market segment, but I don't think it will be a big one.

I would walk away from an illusory/possible 20 grand to get my house sold.

I went the usual route with a realtor. Followed his advice, priced it competitively, etc. I did not get one offer. This has been a colossal waste of my time and a complete invasion of my privacy. When I add in all the time I spent painting, cleaning, decluttering, repairing---its probably been a year of my life preparing for an event that never happened.

Here's what I now know about my area: There's not a shortage of inventory, but a shortage of specific inventory. Also, buyers expect thousands of dollars in closing help...some buyers in my neighborhood are getting $10,000 + in closing help. Also, they want every little thing fixed per inspection. My agent told me to expect another $1500 request for repairs after the inspection.

So, from my perspective, I'm paying at least 15% to sell with a realtor (adding commission + specific upgrades+ closing help + repairs) and that's in addition to several showings, maybe an open house, an inspection, an appraisal, and hoping buyer's financing goes through.

OR

Paying 20% to sell on my timetable with no showings, no inspections, no appraisal, no headache? To me, it's totally worth it. I would go with homelight simple sale, though as it compares ibuyers and you get several offers.

[2bindenver]

the ibuyer programs do have inspection repair costs and additional closing costs paid by the Seller.

[Lincolnian]

I do not think these programs will be good for realtors but they are inevitable. There is too much opportunity for money on the table for a well funded app-based conglomerate. Agents will play a part but will most likely just be tour and transaction agents receiving small fixed fees or percentage amounts. I see an eventual Carmax-type model emerging. Not my wish but the writing is on the wall. As virtual listings improve and companies like Zillow are able to offer legitimate valued warrantees and honest and accurate representations of the home being sold consumers will become more accepting of these models. It is conceivable that a company like Zillow could become the Carmax of real estate offering one-stop shopping where a home buyer can sell, buy and get financing or a cash out all in one place.