Zillow’s Zeal to Outbid for Homes Backfires in Flipping Fumble
bloomberg.com
bloomberg.com
Which makes sense, as anyone who has tried to hire a contractor in the last six months could have told you. I'm not sure if their ML/data tools accounted for that.
But this quote struck something with me :
> “It’s like it’s making decisions two to three months too late relative to the market.”
That's true of everyone buying homes. The only people who have up to date information on what homes are selling for are the local agents, banks, and lenders. If you're trying to understand home pricing from the outside your data is lagging the market by 45-60 days at a minimum.
When I was putting offers on homes over the summer I was astounded how hard it was to find out what a fair price was. For a layperson it was essentially impossible.
Pending sales are updated as soon as it's A/O
It's usually problematic because people suck at searching for comps. And agents are no better at it than anyone else
The status is updated, but is the purchase price entered when a purchase agreement is signed? AFAIK, the purchase price is eventually entered, but there's a lag.
Knowing that an offer was accepted and how fast it was accepted is useful, but what you really want to know is "for how much."
Even if you make an offer and it is rejected or another offer is accepted you and your agent have no idea how far off you were.
They're griping about the "lag" (30-60 days) in price discovery of market comparables as a non-realtor/banker.
Zillow still wants to buy 5k homes/month by 2024.
Zillows Zeal...Flipping Fumble?
They made a bet and it didn't pay off. It could have gone the other way.
Feels like the game of musical chairs from 2009.
However, working with Zillow was incredibly easy and not at all frustrating. We reached out; they inspected the house; they provided an offer; we accepted it; and then they took care of absolutely everything else. They kept us in the loop, set everything up for us, and we ended up with the money in our account and the old loan paid off all the while charging us 1.5% whereas a Realtor would have been closer to 6-8%.
We made out like bandits and I am disappointed I cannot recommend them to anyone else until they come back into the market.
He didn't do much to find properties for me. I had better luck searching open databases of listings that didn't seem any quicker to show properties than the janky search used by the "pros". Basically the realtor set up a search for me on his tool and it sent me new listings that met the criteria. But I couldn't edit this search or browse anything so it was mostly useless.
So I ended up just emailing him lists of properties I found on my own so he could set up times to check them out. And as I was looking for places that were decent but in need of some updates/minor work, practically every single place was sold to developers/flippers for cash before my realtor could get an offer in.
After a year or so looking, I ended up lowering my standards quite a bit because I was getting sick of renting a temporary spot. And of course you sign a contract with a realtor so you can't just shop around for a better one. I was basically stuck because the guy seemed decent in the beginning. But like a car salesman, he lost most of his interest once I was locked in and he realized I wasn't gonna be making him any massive commissions.