The OC Housing Specialist® Ultimate Guide to Buying, Selling, & Renting in Southern California

Why Zillow & Trulia Aren’t Good Substitutes

Hi, my name is Amber and I’m a recovering Zillow-aholic.

I have to admit, before becoming a licensed real estate agent myself, I would drive by a dreamy neighborhood and pull over to search prices on the Zillow or Trulia app. Pretty much every day. I considered myself a highly educated consumer and thought I had a good grip on tech and the real estate industry. But then as so often happens in life, I became more experienced… I look back and now realize I had been naive. I had trusted there was some regulation or requirement for those websites to be accurate. I was wrong.

When I earned my real estate license, I learned how to do comparative market analyses for clients. Then the houses began to sell. Boy oh boy, were those numbers off by A LOT of digits from the website estimates I had been relying on before. I’m talking around $100,000 difference from app estimate to the actual sold price! Yikes.

Which got me thinking about how many owners, trying to save a few dollars on commission, relied on those websites as accurate and listed their homes by themselves. FOR SALE BY OWNER. Inputting so much effort to prepare forms, schedule appointments, prep for open houses, pay for advertising, etc. only to end up disappointed. Either the house being priced too low, the owners end up losing more money than a commission would’ve been. Or too high and the owners spending months and months, watching their home, the place they raised their children, where their life has unfolded, a place they love, just sit there, with seemingly no interest from buyers. It is just heartbreaking to realize the impact of inaccurate information.

The facts are simple enough, and I feel silly to have given so much intuitive credit to a computer program previously. A computer cannot see inside a property. It cannot change the value based on condition or upgrades (or deterioration). It cannot see the overall condition of the neighorbhood affecting the property. It does not hear freeway noise or the dog kennel next door. It does not see the erosion of the soil down the back slope from the recent downpours. It simply pulls public records and consolidates them into a neat package for approximation. Keyword: approximation.

What can you do about it?  You can use a local MLS search website or app that pulls fresh info throughout the day. Any real estate agent can give you access to this, it is free to use and convenient. I’ll include a link here to mine, no strings attached, so you can search all you’d like: Download MLS App Here  I won’t contact you unless you contact me so search to your heart’s desire, friends.

The smartest thing to do is to use a licensed real estate agent in-person to be an extra set of expert eyes for you. An agent is sworn by law to uphold your interests over our own, money involved or not. Many people prefer to use a Realtor® – the difference being a Realtor® is subject to oversight by a local board for guidance, training, and discipline as well as has taken a sworn oath which offers more protection for you. They specialize in YOUR neighborhood, city, and market. They are able to get you linked up to the local MLS listings so you get the new ones the same day they post. They can go through your house and run a home value analysis for you for FREE. Really, the hardest part of the process is going to be locating an agent you click with personality-wise (luckily, there are many to choose from).

The BEST part of using a Realtor®? You do not pay fees if you are a buyer, investor, or renter. The only time you pay for services is if you are selling or renting out a home.

All the help, all the service, all the expertise, all those forms prepared for you, all those hours you don’t have to spend working on it because you have an expert handling it. I wish more industries operated on this fee schedule, like attorneys and doctors.

For more information on why national portal websites like Trulia and Zillow aren’t good substitutes for an in-person real estate professional, check out this excerpt from one of my favorite investment websites:

For the past 12 months, brokerage after brokerage has decided to withdrawal their listings from the nationwide real estate search portals citing, among other things, horribly inaccurate information.

Slllloooooooowwwwwww Real Estate Search Results

National portals like Trulia and Zilliow are slow to show new listings.  When a property is listed for sale it hits the local MLS in a matter of minutes, usually about 15, but can take as long as 9 days to populate to nationally syndicated sites according to studies on the subject.

Bad Data

Approximately 36% of the listings shown as active on Zillow and Trulia were no longer for sale in the local MLS.  The study further found that brokerage sourced listings using their local MLS feed displayed 100% of the MLS homes listed for sale on their websites but Trulia only displayed 81% and Zillow 79%.  So let me summarize – over 1/3rd of the listings you are seeing are NOT ACTUALLY FOR SALE and you only get to see 4/5th of the listings that are actually for sale.

Misleading Advertising

Real estate agents are allowed to purchase advertisements that appear prominently next to listings that ARE NOT theirs to mislead the buyer into contacting the advertising agent while the buyer mistakenly believes they are contacting the listing agent.

What’s My House Worth? (Don’t Ask Zillow)

Unfortunately the Zestimate values aren’t even close to the actual values that the properties sell for. Zesimtate is within 5% of the actual sale price around 33% of the time and within 10% of the sale price around 50% of the time.

To view the full article and source, go to Bigger Pockets

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This entry was posted on January 22, 2016 by in DIY, For Sale By Owner, Investment.

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