Orlando is serving as a test market for Zillow's direct-to-seller platform. Here's how to communicate your worth as a REALTOR®
By Graham Wood
In select markets today, the competition isn’t just from other neighborhood brokerages. It’s also from companies like OpenDoor.com and OfferPad.com, with attractive online platforms that promise sellers a quick, hassle-free, cash sale.
Now Zillow has joined the fray, introducing its “Instant Offers” platform in two test markets, Las Vegas and Orlando. The platform enables sellers to receive and compare cash offers from selected investors, as well as obtain a CMA from one of Zillow’s paying customers, a Zillow Premier Agent.
For many real estate agents, these online marketplaces feel like a threat to their role in the transaction and their livelihood. Zillow, which makes a significant share of its revenue providing tools and services to real estate agents, has moved to dispel that concern, saying it will encourage, but not require, sellers to connect with an agent to close the transaction.
It remains to be seen whether Zillow will be successful enough to expand Instant Offers to more markets. If it does, the promise of a quick sale may capture some consumers’ attention. But many professionals say they relish the opportunity to compete and communicate their value as a real estate professional.
What would you say to sellers who are considering the option of a direct, cash sale?
Here are six talking points.
I work in this market and know the community better than any website could.
I will help you get your house ready for sale.
I will market your home to the widest possible audience, not just investors seeking to make a profit on your home.
I will aim to get you the best offer possible, and I have the skills to help you negotiate the terms of the sale.
One of the best parts of my job is helping you find a buyer who will love your home the way you do.
As a REALTOR®, I follow a Code of Ethics that includes a pledge to “protect and promote the interests of my client” (Article 1). These online companies may facilitate your transaction, but not necessarily with your interests in mind. With “Instant Offers,” unless you choose to work with an agent, you’ll be on your own handling the details of the transaction.
If past performance is any indicator of the future, sellers will continue to gravitate your way. The National Association of REALTORS®’ 2016 Profile of Home Buyers and Sellers showed that 89 percent of sellers worked with a real estate professional to sell their homes. Only 8 percent of home sales in 2016 were FSBOs.
Still, direct sales may pose other challenges to the industry.
In addition to competing for sellers’ attention, these online investor sales may exacerbate the already tight inventory situation many of your buyer clients are facing. Instant Offers, for example, connects sellers with a small group of investors who are partnering with Zillow. Sellers who go that route are taking their home out of the inventory for the average buyer.
Also, sellers who choose direct sales aren’t listing their property on the MLS, which has the potential to affect the reliability of MLS data for the real estate professionals, economists and governments use that data to spot market trends, determine fair market values, and make plans.
Graham Wood, firstname.lastname@example.org, is senior editor of REALTOR® Magazine. Reprinted from REALTOR® Magazine Online, May 26, 2017, with permission of the National Association of REALTORS®. Copyright 2017. All rights reserved.