8 ms·

Sold my house this summer. My wife listed the house on Zillow and took nice looking pictures and put a good description. We also paid a real estate agent $300

by bcg1 11y ago

Sold my house this summer. My wife listed the house on Zillow and took nice looking pictures and put a good description. We also paid a real estate agent $300 to list our house in the MLS (and we would handle the rest of the sale). Once our listing was in the MLS Zillow brought in the crapified compressed JPEGs from the MLS feed and overwrote our description etc, and locked us out from further edits. Fail. Zillow is going about this all wrong... their advantage is that they aren't the MLS system, they are the best positioned to be an alternative to the NAR cartel. If anything THEY should have agents in every town who will put your house into the MLS for you for $300, as well as allow enhanced listing on their site at the same time... they might actually make some money that way, and also it would solve their MLS problem. Instead they seem to want to beg the cartel for a seat at the table. Pretty sad.

gdubs 11y ago
In the end, do you know whether Zillow or the MLS listing led to the sale?
rdtsc 11y ago
NAR is a strong lobby, they will fight tooth and nail to keep their position. Million + realtors are betting their livelihood on having a hold on buying and selling homes, and are not going to let that go easily. Here is allegedly their letter to the president in 2011 (not related to Zillow but basically how they can throw their weight behind issues): http://www.ksefocus.com/billdatabase/clientfiles/172/3/1359.pdf http://www.ksefocus.com/billdatabase/clientfiles/172/3/1359.... At some point perhaps they might strike a deal work together if they can't' see a way get rid of Zillow.
- aggieben 11y ago
  There will never be a deal. NAR's prosperity absolutely depends on their exclusive control of market access. Professional licensing is the single reason why this market sucks donkey balls. This is also why I would heartily support a total deregulation of real-estate-related professional licensing. It simply isn't that complex a task, and it doesn't really require much training to be competent at most transactions - and particularly the one kind of transaction you want to do. Anyone and everyone should be legally allowed to represent someone in selling or buying real estate. In that world, the NAR continues to exist as a sort of "credibility certification", which I would fully support. But they shouldn't get to use the government to keep competitors out.
  - JamesBarney 11y ago
    While I'm usually against certification, I don't think one weeks worth of studying and a $300 fee is a huge barrier to entry to be able to oversee a $300,000 transactions and have unrestricted access to 70% of houses on the market. I don't think the market would change much if this barrier was removed. The median realtor is only $38,000 a year.
    - aggieben 11y ago
      $300 fee? No, my friend. If you buy something on MLS, you pay at least half of a 6% commission on that $300k, for a cool $18,000 (if you have an easygoing seller, that is) How's that for a barrier to entry? And yah - the market would revolutionize overnight* because without professional licensing suddenly MLS becomes just one of many sources of data - and judging by the technology of MLS, a quickly irrelevant one. * - I exaggerate: it would take at least a fortnight.
      - URSpider94 11y ago
        He's referring to the cost to become licensed as a professional Realtor, at which point you can sell your own home.
        aggieben 11y ago
        You can sell your own home without a license. He was referring to the "cost of entering the MLS market" (my paraphrase) being a mere $300 (for having an agent list the sale). My point is that's not true because any actual sale costs an additional 6% of the transaction.
toomuchtodo 11y ago
You just listed all the reasons Redfin (https://www.redfin.com https://www.redfin.com) is killing it. Their value proposition is that their agents aren't paid on commission, they're paid on your satisfaction. Their website is also very data-intensive compared to MLS sites (which create information asymmetry between buyers, sellers, and brokers due to how they're setup).
- encoderer 11y ago
  Otoh, are the very best agents going to work for rf and make less money? Redfin looks like modern KW to me. Most great agents don't want to undersell their own industry. And while there are many markets where a mediocre agent will do, I wouldn't take that chance in sf, la, Nyc, Miami, etc
  - toomuchtodo 11y ago
    Would I use them to sell? Maybe. Would I use them to buy? Most definitely. As mentioned further down in this thread, buyer's agents have every incentive for the buyer to pay as high a price as possible (due to RE commission structure). I want someone earning a fee on my transaction because they got me the best price (as either buyer or seller). Price of a service can be a form of signaling, but paying more for something does in no way mean you're getting better served.
    - rconti 11y ago
      Depends on the market. In a competitive market, I want my agent to be as dedicated as possible, not one taking a smaller cut. We won a 13-offer bidding war on a financed deal with only a SLIGHTLY higher price than the 2nd place, all-cash offer. anything could have made the difference in the deal, and I'm more than happy to throw another 10k at the agent to have it locked down. You're right that traditional agents have incentives to get the highest price, but so does a Redfin agent.
      - aggieben 11y ago
rgbrgb 11y ago
Congrats on the sale! You could argue that "Zillow is going about this all wrong" if their goal was trying to improve the process of buying and selling homes or if they were trying to make it more affordable to buy a home. What you have to realize is that they have a business that's working very well within the real estate status quo: agents pay them money for ads to get leads, agents who are able to convert leads make a ton from commission, the cycle continues. A public company with an established business model (that prints money!) is not going to pivot and suddenly compete with their well-paying customers. However, I totally agree that there's a huge opportunity to improve the buying/selling experience and lower transaction costs. My team is working extremely hard on that problem. Edit: I should note that Zillow has done tremendous work on improving the home shopping process and I'm definitely not trying to knock them on that. They and their competitors have brought the shopping process online and given consumers access to listing info that was previously only available to agents. The actual offer/transaction (the buy button) is the extremely complicated piece we're trying to tackle. It just so happens that in tackling that piece and becoming a brokerage, we get access to a high quality broker-only data feed.
- deleted 11y ago
  [deleted]
- bcg1 11y ago
  You make excellent points. I guess what I meant was that Zillow's model _should be_ to improve the process and to make it cheaper. Maybe 6%-7% commission is still appropriate for high-end properties that only have a limited pool of potential buyers (that's not my world, I don't really know) but for average homes in 2015, it is an anachronism left over from a time when buyers and sellers couldn't do a lot of the legwork themselves online. Its not hard to see that there is a ton of money to be made closing that gap. Just perused your website and from what I read your company certainly seems to have the right idea. As it happens our buyer did end up having an agent and we paid that agent a 3% commission, so from what I read your system definitely could have worked in our transaction and saved our buyer some dough. The $300 we paid the agent to get us into the MLS truly paid off though... we saved literally thousands. Looking back I could pay triple that and it would be a no-brainer. Just something to consider - toss in some boilerplate forms or instruction guides or whatever and it could be a great product with excellent margins. I bet theres a bunch of tech savvy go getter millenials that would get licensed to do the local work necessary. Anyhow, I'm really glad to see someone doing what you're doing, best of luck to you... I truly hope you win
takee 11y ago
Wait a sec. When you say you paid the realtor $300 to put the listing on MLS, do you mean that you used the realtor only for that service? Or was this in addition to the other services that a typical realtor generally provides? I am trying to understand how easy it is to go about selling your house on your own using zillow etc, while saving on the sale commission etc that a realtor would have made otherwise.
- tacon 11y ago
  Yes, that is about right for a bare MLS listing and the agent withdraws from the sale. How to find such brokers? Just attend one of your local real estate investor meetings and they will tell you who can help. Such brokers might even be at the meeting. This started to irritate the brokers in Texas a few years ago, so TAR got the legislature to change the real estate licensing statute to include a line about "minimum professional services". Oddly, that hasn't really slowed down this practice as far as I can see. The shadow broker does need to answer calls from other brokers/agents, as they can get quite testy when they find themselves talking directly to the seller. But they soon hand over the contact and move on.

by bcg1 11y ago

gdubs 11y ago

In the end, do you know whether Zillow or the MLS listing led to the sale?

rdtsc 11y ago

NAR is a strong lobby, they will fight tooth and nail to keep their position. Million + realtors are betting their livelihood on having a hold on buying and selling homes, and are not going to let that go easily. Here is allegedly their letter to the president in 2011 (not related to Zillow but basically how they can throw their weight behind issues): http://www.ksefocus.com/billdatabase/clientfiles/172/3/1359.pdf http://www.ksefocus.com/billdatabase/clientfiles/172/3/1359.... At some point perhaps they might strike a deal work together if they can't' see a way get rid of Zillow.

aggieben 11y ago
There will never be a deal. NAR's prosperity absolutely depends on their exclusive control of market access. Professional licensing is the single reason why this market sucks donkey balls. This is also why I would heartily support a total deregulation of real-estate-related professional licensing. It simply isn't that complex a task, and it doesn't really require much training to be competent at most transactions - and particularly the one kind of transaction you want to do. Anyone and everyone should be legally allowed to represent someone in selling or buying real estate. In that world, the NAR continues to exist as a sort of "credibility certification", which I would fully support. But they shouldn't get to use the government to keep competitors out.
- JamesBarney 11y ago
  While I'm usually against certification, I don't think one weeks worth of studying and a $300 fee is a huge barrier to entry to be able to oversee a $300,000 transactions and have unrestricted access to 70% of houses on the market. I don't think the market would change much if this barrier was removed. The median realtor is only $38,000 a year.
  - aggieben 11y ago
    $300 fee? No, my friend. If you buy something on MLS, you pay at least half of a 6% commission on that $300k, for a cool $18,000 (if you have an easygoing seller, that is) How's that for a barrier to entry? And yah - the market would revolutionize overnight* because without professional licensing suddenly MLS becomes just one of many sources of data - and judging by the technology of MLS, a quickly irrelevant one. * - I exaggerate: it would take at least a fortnight.
    - URSpider94 11y ago
      He's referring to the cost to become licensed as a professional Realtor, at which point you can sell your own home.
      - aggieben 11y ago
        You can sell your own home without a license. He was referring to the "cost of entering the MLS market" (my paraphrase) being a mere $300 (for having an agent list the sale). My point is that's not true because any actual sale costs an additional 6% of the transaction.

toomuchtodo 11y ago

You just listed all the reasons Redfin (https://www.redfin.com https://www.redfin.com) is killing it. Their value proposition is that their agents aren't paid on commission, they're paid on your satisfaction. Their website is also very data-intensive compared to MLS sites (which create information asymmetry between buyers, sellers, and brokers due to how they're setup).

encoderer 11y ago
Otoh, are the very best agents going to work for rf and make less money? Redfin looks like modern KW to me. Most great agents don't want to undersell their own industry. And while there are many markets where a mediocre agent will do, I wouldn't take that chance in sf, la, Nyc, Miami, etc
- toomuchtodo 11y ago
  Would I use them to sell? Maybe. Would I use them to buy? Most definitely. As mentioned further down in this thread, buyer's agents have every incentive for the buyer to pay as high a price as possible (due to RE commission structure). I want someone earning a fee on my transaction because they got me the best price (as either buyer or seller). Price of a service can be a form of signaling, but paying more for something does in no way mean you're getting better served.
  - rconti 11y ago
    Depends on the market. In a competitive market, I want my agent to be as dedicated as possible, not one taking a smaller cut. We won a 13-offer bidding war on a financed deal with only a SLIGHTLY higher price than the 2nd place, all-cash offer. anything could have made the difference in the deal, and I'm more than happy to throw another 10k at the agent to have it locked down. You're right that traditional agents have incentives to get the highest price, but so does a Redfin agent.
    - aggieben 11y ago

rgbrgb 11y ago

Congrats on the sale! You could argue that "Zillow is going about this all wrong" if their goal was trying to improve the process of buying and selling homes or if they were trying to make it more affordable to buy a home. What you have to realize is that they have a business that's working very well within the real estate status quo: agents pay them money for ads to get leads, agents who are able to convert leads make a ton from commission, the cycle continues. A public company with an established business model (that prints money!) is not going to pivot and suddenly compete with their well-paying customers. However, I totally agree that there's a huge opportunity to improve the buying/selling experience and lower transaction costs. My team is working extremely hard on that problem. Edit: I should note that Zillow has done tremendous work on improving the home shopping process and I'm definitely not trying to knock them on that. They and their competitors have brought the shopping process online and given consumers access to listing info that was previously only available to agents. The actual offer/transaction (the buy button) is the extremely complicated piece we're trying to tackle. It just so happens that in tackling that piece and becoming a brokerage, we get access to a high quality broker-only data feed.

deleted 11y ago
[deleted]
bcg1 11y ago
You make excellent points. I guess what I meant was that Zillow's model _should be_ to improve the process and to make it cheaper. Maybe 6%-7% commission is still appropriate for high-end properties that only have a limited pool of potential buyers (that's not my world, I don't really know) but for average homes in 2015, it is an anachronism left over from a time when buyers and sellers couldn't do a lot of the legwork themselves online. Its not hard to see that there is a ton of money to be made closing that gap. Just perused your website and from what I read your company certainly seems to have the right idea. As it happens our buyer did end up having an agent and we paid that agent a 3% commission, so from what I read your system definitely could have worked in our transaction and saved our buyer some dough. The $300 we paid the agent to get us into the MLS truly paid off though... we saved literally thousands. Looking back I could pay triple that and it would be a no-brainer. Just something to consider - toss in some boilerplate forms or instruction guides or whatever and it could be a great product with excellent margins. I bet theres a bunch of tech savvy go getter millenials that would get licensed to do the local work necessary. Anyhow, I'm really glad to see someone doing what you're doing, best of luck to you... I truly hope you win

takee 11y ago

Wait a sec. When you say you paid the realtor $300 to put the listing on MLS, do you mean that you used the realtor only for that service? Or was this in addition to the other services that a typical realtor generally provides? I am trying to understand how easy it is to go about selling your house on your own using zillow etc, while saving on the sale commission etc that a realtor would have made otherwise.

tacon 11y ago
Yes, that is about right for a bare MLS listing and the agent withdraws from the sale. How to find such brokers? Just attend one of your local real estate investor meetings and they will tell you who can help. Such brokers might even be at the meeting. This started to irritate the brokers in Texas a few years ago, so TAR got the legislature to change the real estate licensing statute to include a line about "minimum professional services". Oddly, that hasn't really slowed down this practice as far as I can see. The shadow broker does need to answer calls from other brokers/agents, as they can get quite testy when they find themselves talking directly to the seller. But they soon hand over the contact and move on.