In 2015, homebuyers are more sophisticated and savvy. They have adopted online tools, like Zillow’s home price estimator “Zestimate,” as critical additions to their home search preparations. But while the proliferation of available information on home prices and neighborhood peculiarities has in many ways empowered buyers and sellers, it’s also had the (perhaps) unintended consequence of spreading misinformation and encouraging unfounded skepticism.
“I would say about half of sellers quote a Zestimate value or other online estimation, which initially makes them feel their home is worth more than it is,” said Coldwell Banker Broker and Realtor Christine Groves, who added that while buyers fall into a similar trap when picking homes, they are more and more doing their “due diligence,” which includes “comparing online valuation versus list price.”
There’s a clear divide among clients, Groves pointed out, drawn along lines of expectations and stubbornness: some are receptive to counsel, some are not.
“Most consumers that bring up these online values are easily counseled to understand the difference between (real value) and an online computation that does not account for all the things a home is evaluated on,” she said, citing updates, amenities, finishes and lot location and size, as some of the important factors not considered by tools like Zestimate. “(The rest) are still not convinced that agents aren’t just trying to ‘low ball’ to get a deal done.”
From an agent’s perspective, approaching the situation has to be handled strategically, as debates with clients can quickly lead to arguments, entrenchment and eventual quagmire. Groves said that she doesn’t wait for the discussion to begin, but rather proactively informs her buyers and sellers of the reality of not only the market, but their current situation.
“An agent has to always come prepared with knowledge of an area, market trends, recent sales and activity, and be able to provide that information,” she said. “Being proactive even before a conversation leads to ‘but it says online that it’s worth…’ is the best possible solution.”
Clayton Jirak, an agent with Redfin, mimicked Groves’ strategy, agreeing with her notions of agents arming themselves with data and knowledge before the process even begins.
“By providing clients (and potential clients) with accurate, up-to-date information, we find that we empower them,” he said, adding, “and they feel better and more confident in the process.”
But neither Jirak or Groves wants to be misrepresented as being against the Internet or the information that’s available to buyers and sellers – though, Groves did say she’d like sites to “either do away with their online estimates or have clear disclosures that it is merely an estimate…not a proper home evaluation.” Both described the information available to clients as mostly helpful, and Groves explained that while nearly all Internet users are exposed to misinformation, most are quick enough to be critical of what they read.
“Most people have learned to temper what they read on the Internet. It’s an agent’s job to confirm or question that information in cooperation with the client,” she said. “Most consumers realize that the Internet is just an added tool to conduct their search for a home.”