Friday, October 5, 2012

Gaps in Big Online Listings Revealed

Shopping for residential real estate doesn't necessarily require dressing up in your Sunday best and retaining the perfect real estate agent anymore. While many home buyers still seek out a professional real estate agency for a more personalized experience, many house hunters scour well-known real estate sites to search for their dream home. In the past five years, websites such as Zillow and Trulia have taken the internet by storm. Whether people are shopping for new homes, rentals, or foreclosure listings, big real estate websites are often the first place people look. There's just one problem with this; what you see is not necessarily what you get.

Listing Gaps - AKA Listing Inaccuracies


A smaller brokerage-run real estate website, Redfin.com, noticed that the Big Guys - meaning Zillow and Trulia - didn't have the number of listings that Redfin did. Not only that, Redfin also noticed that many of the listings weren't valid. Executives finally decided to do something about it. What did they do? They hired a real estate consulting firm called WAV to look into the number of listing gaps - or listing discrepancies - on real estate websites to compare them.

WAV evaluated Redfin, Trulia, and Zillow and added Windmere and Long & Foster,  which are two regional brokerage-run real estate web sites. They took a sampling of more than 6,400 residential real estate listings in over 33 zip codes across the United States. This is what they found:
  • Redfin, Windmere and Long & Foster had 100% of the Multiple Listings Services (MLS) listings on their sites
  • Trulia had only 81%
  • Zillow had 79%

They also discovered that:
  • 36% of agent-listed houses showing as "active" on Zillow were no longer for sale as per MLS
  • 37% of Trulia's (supposedly) active agent-listed homes were no longer available on MLS
  • Less than 2% of the listings were mis-labeled in Redfin and Windmere listings
  • 0% of the listings on Long & Foster's site were inaccurate
Why all the discrepancies? Well, unlike brokerage-run websites, which have in-house representatives culling their listings from MLS, these larger sites are funded by...you guess it...advertisers. So while a certain level of accuracy is important to keep web visitors coming back, at the end of the day accuracy isn't as important as it is for companies who make their profits by being great at what they do - selling legitimate real estate properties.

So what does this mean for you as a buyer?
It doesn't mean that you should never use sites like Zillow or Trulia, but it does mean that you should use them with caution. Make sure to also check in with more reputable sites, such as Redfin - or those of a local brokerage firm. If you do find a property you like on one of the bigger sites, don't get your hopes too fast. Remember - you have close to a 40% chance that the property is misrepresented and/or is no longer on the market.

By using a regional brokerage-run website, or a local real estate company, to assist you on your house hunt, you can count on accurate listings to find your dream home.

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