News on the Zillow front
A Zillow feature that has been several years in the workings launched today as they announce the addition of lease listings to their site. David Gibbons, Customer Relations Specialist said that “the origin of the rentals idea pre-dates our launch in ’06.” According to a third party polling company, Harris Interactive, 25% of consumers will look for both sales and leases in next three years (nearly 2500 people were questioned).
Lease listings will appear in search right alongside homes for sale which is an interesting move and one agents may not hail but information thirsty consumers might. Jim Duncan said, “one aspect that I think is missing the mark is the inability to list a home as both for sale and for rent. In this market with the prevalence of so many homes being listed for sale and for rent, I think that they would be well served to offer this an an option.”
This is going to be a red flag sticking point for several real estate professionals. Gibbons said it was a challenge “to figure out how to present the search results and how to really present the map search in the rent versus buy equation.
The solution to the quandry
Because it was a challenge to map out lease and sales listings simultaneously, Zillow came up with the idea that alter search to be done by monthly rental payment if a consumer so wishes. Lease listings pop up on a search map for a designated area in purple (see the map in the image above) while sale listings pop up in red. Monthly payments for homes for sale is estimated on a 30 year mortgage with 20% down and the current rate pulled from Zillow’s Mortgage Marketplace which is updated hourly.
This doesn’t solve the problem of homes that are both for sale and for lease, but I believe it’s a start and Zillow (because it’s a media company and not a real estate brokerage) usually at a minimum listens to input from agents which they will surely be flooded with come the time everyone reads this news.
The new lease listings will be supported by “advice columns” according to Drew Meyers, Business Development Specialist at Zillow, which will consist of six or seven categories. Will this trump “Trulia’s Voices” and be the go to location for renters to get advice from professionals? I think there’s a good chance. Renters are taken advantage of frequently or simply get confused and have a large array of places to land but Zillow may quietly be looking to get their foot into this door.
Gibbons indicated that feeds will be important most immediately and when asked about presenting lease zestimates which I think would be a terrible mistake that would punish small time landlords. Gibbons said that they are “not launching with rental zestimates, as we don’t have database of rental history unlike public records of sold homes. There needs to build more of a database before estimating but it’s definitely something we’d love to do.” Oh, no.
Kris Berg said, “the one thing that causes me a little indigestion is the possibility that over time and given a reasonable arsenal of historical rental activity data, Zestimates may ooze forth to contaminate the rental space as well. I know firsthand how much real estate agents dig Zestimates; I suspect landlords will be just as giddy with the Zillow pricing assist when they are attempting to rent their properties for fair market value. As an agent, I deal, but then I am not paying $10 a pop for the exposure. Those paying customers who list rentals may not be so forgiving.”
Gibbons said, “Zillow always planned to differentiate itself as “the database of ALL homes.” As such, knowing which homes were for rent were part of the plan all along but as a startup with constrained resources in a volatile, sequencing these things is important.”
“Database of ALL homes” sounds like a move toward being a one stop shop, including lease zestimates but excluding the option to list a home for sale and for lease and it only costs $9.95 per uploaded listing.
To learn the details of the other half of Zillow’s news release, click here.