Zillow Informs and Confuses : Part 2 – Foreclosures and More
Just like my prior post about Zillow’s Zestimate service, I have mixed views of Zillow’s transparency with potential properties for purchase. On the plus side, I think it’s quite fun to have features like “Make Me Move” to see what homeowner’s expectations are and a comprehensive listings of all properties. For those looking to casually browse out of curiousity or mere interest, those features are great diversions. However, for those actually looking for a home, those same features become endlessly frustrating.
Like many other real estate related websites that provide listings of homes, Zillow gets a syndicated feed of listings from the multiple listing service (MLS). Since most Realtors use the MLS to promote their listings, the data quality on the MLS is quite high. There might be a few occasional mishaps, but those are the exceptions. But, once that data finds a home on a syndicator’s site like Zillow, it gets lost in a jungle of expired, pending, and cancelled listings. It’s quite frustrating to find a great house only to find out that it’s not actually for sale. I’ve had plenty of clients excitedly send me listings from Zillow only to find out those homes were already pending or sold. That’s one of the reasons why my firm only provides the most up-to-date listings. If it’s an active listing where the property is actually on the market for sale, then it’s on our site.
Also, like other sites, Zillow combines market listings with properties in various stages of foreclosure. While having foreclosure data is useful information, for the real estate professional who understand the process, it’s really just confusing for the casual consumer. Usually, the foreclosure listings just show a street name of a property that may have received a notice of default. Unfortunately, many homebuyers believe that those are also valid listings of properties for sale. They spend many hours trying to chase down those properties only to discover that there’s virtually no chance of them getting it. Bottomline, just because a property is in the process of foreclosure, it doesn’t mean it’s a foreclosed property that’s available for sale. There’s a big difference that gets lost in the terminology.
What a buyer should look for is a property in the process of foreclosure that’s on the market, either through an auction or a short sale. Buying at different stages of foreclosure requires different sets of preparation and capital available. As with investors, the best deals go those who have the cash in hand. Trying to pre-empt the foreclosure process by approaching homeowners in the foreclosure process is both a dangerous and low-return strategy that’s best left to experienced real estate investors.
It’s far better to look for homes actually put up for sale with a Realtor. You can avoid spinning your wheels for months trying to figure out which mysterious foreclosure on Zillow is actually available. If you’re feeling lost, I’d be glad to help.
You can follow any responses to this entry through the RSS 2.0 feed.