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March 12, 2007
Realtor.com takes on Zillow.com
Home pricing site Zillow.com caused a huge sensation when it started offering its Zestimates on what people's houses are worth. All the attention (and online traffic) has spurred rival Realtor.com to respond. The company's new Real-Time Market Snapshot gives online home shoppers access to more recent sale prices in a particular neighborhood.
Some background: Realtor.com was among the first Internet sites devoted to housing. It was actually started by the National Association of Realtors, a group that always wants to make sure its got a piece of any home sale. Realtor.com has long offered a "What's Your Home Worth" feature. Both it and Zillow rely on county deed records to generate the data. While Realtor.com gives a wide price range for a property, Zillow gives a specific estimate, and thus produces a lot more buzz.
Now the Realtors are striking back. "The problem with the county data is it's about three months old," says Errol Samuelson, president of Realtor.com. His new Real-Time service uses data gleaned from the many multiple listing services across the country. That data is generated by the Realtors themselves. Having more up-to-date data is important as housing prices soften.
In order to get that Real-Time snapshot you have to leave a particular property address and your contact info with Realtor.com, which then feeds your request to a local Realtor. Thus, you'll get contacted by an agent. On the sample snapshot that I got, the transaction data was more recent, but there still wasn't a specific estimate of what the property is worth.
I should add, while a recent study by the Wall Street Journal found Zillow's Zestimates to be fairly accurate. Their Zestimate for the sample house I used was $800,000. It's actually worth $1.3 million, judging by recent sales on the block. That's a huge discrepancy. The online real estate wars continue.
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? Realtor.com takes on Zillow.com? Not Quite. from Blue Collar Agents Blog
Buyers and sellers love to see property sales data. Seeing what properties are actually selling for can be much more useful than what sellers want to sell their homes for. After all, asking prices are mere wishes until a buyer comes along and agrees to... [Read More]
Tracked on March 12, 2007 04:32 PM
As an agent in the East Bay area of California and a person who has been marketing on the Internet for over 12 years - I must say, the NAR and Realtor.com - STILL DON'T GET IT!
While people will complain about inaccuracies, they will continue to use Zillow over Realtor.com because Zillow gives it away to the consumer.
While we continue to use some forms on our site, we are moving more away from them to the give it away model.
The NAR's biggest problem is not Zillow or Trulia or any of the others - It's lack of vision and creativity. When you're stuck in REACTION it's bad enough. But, when you're stuck in reactivity and trying to hold on to the past - you're lost.
Posted by: john harper at March 10, 2007 11:52 AM
I find this a really interesting article, in the UK we can get actual sold house price data from the land registry and there are a number of sites that provide this. It appears that this is not something that is available in the US otherwise why dont the sites just use that data rather than 'guesstermats'. The actual sold price data would be much more accurate.
Posted by: Rental Property at March 11, 2007 02:37 AM
In a drastically slow market, not even recent data is sufficient because the data doesn't exist due to lack of sales and one must use data from further afield to estimate it, data that is not always comparable. Appraisals lag on the the way up and on the way down and lag the most in hot and cold markets; it is simply the nature of the data.
Posted by: Lord at March 11, 2007 12:42 PM
Both realtor.com and zillow.com provide pictures of houses, basic details ( number of rooms, square footage), and a price. Where zillow.com provides the address of each house, and details of houses on and off the market, and a estimate based on statistical methods, realtor.com only provides addresses by contacting an agent. Their prices are the offer prices and in this housing market usually an imaginary price. Where the public records includes previous transactions by address, it is not easy to match that with specific houses without knowing the address.
Whether zillow's estimates are accurate is secondary to being able to compare houses in an area and to compare them with actual past transactions. I know real estate agents get extremely uncomfortable and nervous, just by mentioning zillow.com in any conversation. That can not be a bad thing.
Posted by: hal cline at March 12, 2007 12:07 PM
Zillow has a technology that is improving over time. I think that the real estate industry is evolving from an it's-us-against-them kind of attitude to a more collaborative sand box.
There are some areas of the country where there is still a great disparity in online valuation engines. We illustrated one of these recently on RealTown.com, where a house listed at $7.5 million is shown alongside a Zestimate of $4.5 million:
Posted by: Frances Flynn Thorsen at March 12, 2007 12:25 PM
I feel that zillow.com has provided information in a very user friendly format which is why there was so much buzz around there website. I really think that realtor.com has there hands in to many pots as it is and that the everyday consumer will stick with zillow because there will not be any reason to pick realtor.com over zillow.
Posted by: Ben Tyson at March 12, 2007 03:14 PM
I much prefer neutral sources like trulia for listings and propertyshark.com for property research and sales comparables (it only seems about 2 weeks old on there, not 3 months). And at least that data is official from the county. Who is auditing these Realtor self reported 'real time' numbers you mentioned?
Posted by: Reed at March 12, 2007 05:56 PM
Part of Realtor's wanting an agent to contact you after you've asked them about a property is so that they can sell you on something and so that they can put together a price for the place.
To say that Realtor has "real time" figures is like saying Kramer on Seinfeld offered real time movietimes. They just do it by hand probably after querying zillow.
Posted by: BlogReader at March 13, 2007 06:20 PM
Escuse me, but does anyone actually use these services I see written about here!? I typed my zip code into the trulia site, along w/ a spread of $50000 to $150000, and got 2, yes, that's right, 2 listings. Zillow.com isn't much better, and propertyshark.com gives you a choice of 4 cities to search in the entire state of Texas. Yes, 4 cities. These sites are USELESS. Please, do what we and everyone we know does: go to www.realtor.com. They show EVERY MLS listing in the US and many other cities. Yes, every single listing. Silly isn't it.
Posted by: steve at March 13, 2007 11:16 PM
I hear that Realtor.com is working on a major overhaul of their property listing search, and is supposed to release it sometime in the next couple of months. Does anyone else know anything about this, and whether it's supposed to close the gap between its and Zillow's functionality?
Posted by: Little Birdie at March 13, 2007 11:37 PM
I have seen lots of discussion in the blogosphere about zillow and what it will do to the Real Estate industry. This news was 'hot' a few months ago and then basically disappeared. Maybe with this new Realtor.com announcement people will start talking again...
Chandler, AZ Realtor
Posted by: Kaushik Sirkar at March 14, 2007 03:09 AM
I think Zillow is trying hard to plenish and update their databases, but for the time being the fact remains that based on our research most Zestimates by Zillow are usually at least 20 - 25% below the current market value.
The problem that Zillow faces is that often county records do not reflect e.g. the actual size of the home in regards to square footage as well as regarding bedrooms and baths, meaning usually Zillow shows a lesser than the actual number. This discrepancy between inaccurate county records and the actual facts of a property lead to the reduced Zestimates on Zillow as it seems that the price per sq.ft. is used to calculate their automated Zestimates.
True, home owners can claim their property and make adjustments, but while these adjustments are displayed on Zillow, it seems as if Zillow doesn't take those corrections by home owners regarding their properties into account when calculating their Zestimates.
Nonetheless, Zillow is still a young search engine specific to the home industry, and since it started a year ago it has already improved a lot, and over time their databases will interact and function more accurate. Also, Zillow is a great advantage for home and area searches, even if their satellite photos are at least 2 years old and not updated for now, but it does give prospective home buyers an idea about the area and also the new feature of comps/actual homes sold is a big, big plus and should help to bring the Zillow's Zestimate's up-to-date.
Posted by: scherf.com at March 20, 2007 04:33 PM
Little Birdie, Realtor.com's new property search redesign launched just last week as a beta, a link to it at the top of the realtor.com home page.
Early as it is, does anyone have any thoughts on whether this change will have any affect on how consumers use the site and view its listings?
Posted by: EndTable20 at March 26, 2007 01:36 PM
Zillow is great. I dont use their estimate to judge prices. After all its all a bubble anyway. Im my area the bubble started in early 1998 since that was the last time we had rational prices. Since zillow provides historical sales in 1998 I simple add in year over year appreciation equal inflation to get actual price home should be selling for today. It has been proven that homes only appreciation at rate of inflation. I will continue to use zillow and watch as declines are currently taking hold. We are already down 10% in my target city. I expect this to continue down 40-50% from peak. I fail to understand why so many mistakenly believe prices wont go down in the next few years. Any comparable price you see should not be considered. We currently are seeing major corrections starting with subprime. It was not the loan thats the problem but the pricing of homes.
Posted by: DonP at April 12, 2007 01:28 AM
It would be really nice if Realtor.com got with it and started doing what they should have done 10 years ago, rather than waiting for someone to come and take their lunch. But that is what happens when your sitting back and thinking you have everything that will ever need to be done, finished.
Keller Williams Realty
488 Springfield Ave.
Summit, NJ 07901
Posted by: James Boyer at May 5, 2007 10:46 AM