Zillow Instant Offers - Should You Sell Your Home?
by Erin Salem
on Monday, April 16th, 2018 at 2:05pm.
Websites like Trulia, Realtor.com, and Zillow have made the market transparent; literally anyone can see when a house goes on the market and do their own research to determine if a home is fairly priced. Of course, these types of public websites aren’t as accurate or efficient as the Multiple Listing Service (MLS), a website that is only available to Realtors, but they do educate the general public in ways we’ve never seen before.
But now, these sites aren’t just offering you free information about the market: they’re getting into the business of buying and selling your homes. For example, Zillow’s “Instant Offers” program allows you to receive several offers on your house within a few days, and all you have to do is send details and a few photos.
We took a day to investigate this practice because we honestly weren’t sure how it worked. Here’s what we found out:
1. To make these transactions, Zillow is only using local Realtors who have invested in their Premiere Agent program (a pay-for-play program that allows Realtors to advertise and collect leads). We can’t say that’s an altogether poor business model. 2. Zillow says on its website that local investors, corporate businesses, and Zillow itself will be purchasing homes through their Instant Offers program. While this removes the concern of a buyer being financially qualified to purchase your home, it negates the possibility of negotiation, which potentially robs the seller of thousands of dollars. 3. The Realtors’ motivation is questionable in these cases. They work for the transaction to potentially reach a selling price that isn't what the seller originally envisioned. This might mean the ones getting the best deal are Zillow and Zillow’s investors, not you. 4. We can assume that Zillow is not going to purchase a home from you for market value and then turn around and sell it for market value. Zillow, nor the agents, would make money this way. Sellers can draw their own conclusions regarding who is the one taking the hit on the transaction. 5. The Instant Offer program, and others like it, take an experience like buying and selling a home and depersonalize it. While this is great for investors who are simply looking to flip properties, it fails to take into account what you need, feel, or want out of your own transaction. In other words? Ain’t nobody care about you.
We’re not positive what Zillow’s end-game is by entering into the home buying and selling field, and by no means do we think it’s malicious. But we do know that buyers and sellers get the short end of the stick all the time when they try to complete transactions without a professional involved. For every person out there who researches their own home’s value before putting it on the market, there is someone else who participates in a program like Zillow’s Instant Offers because it seems easier, faster, and like less of a hassle. And while that could be true, it usually results in the seller leaving thousands of dollars on the table in exchange for the quick and easy. Remember, buying or selling a home is not quick or simple, no matter who you are. If someone tells you it is, ask more questions.