Zillow sells consumer information to Realtors
The United States-based real estate website Zillow will expand into Canada this year. But don’t expect it to revolutionize the Calgary real estate market. Zillow is just another website to explore Calgary homes for sale, except with one major difference: Zillow makes money by selling your information to Realtors.
What is Zillow?
Consumers and Realtors are connected by the price the Realtor paid for the lead – not by their values, goals or relationships.
When you’re browsing listings on Zillow and are interested in a property, Zillow connects you to a Realtor who pays the most for your contact information. Essentially, Zillow treats all users as leads and sells the information to Realtors.
Consumers and Realtors are connected by the price the Realtor paid for the lead – not by their values, goals or relationships. For the consumer, they get connected with a Realtor who is just looking for a lead.
And the last thing you want as a buyer is a real estate agent pushing you into a purchase for their paycheque and to pay off Zillow as a ‘thank you’ for your personal information.
What is the difference between Zillow and a Realtor’s website?
When it comes to real estate listings, there is no difference between Zillow or every other real estate website. Because all websites, including Zillow, receive the listings from the same platform – the MLS.
All the real estate listings in Canada are owned by the Canadian Real Estate Association. That means everyone – Realtor and Canadians – have fair access to all listings. That is why you see all the same listings on Find Calgary Home and every other real estate website.
What does Zillow mean for Calgary home buyers and sellers?
Zillow doesn’t replace Realtors
Zillow uses the listings to sell advertisements and make commission from Realtors because Zillow turns the consumer into a lead.
Since Zillow will re-display the properties from the MLS, the websites will show the same listings and information.
No matter what website you use to look for a home, they will all still connect you to a real estate agent. Since Zillow is not a brokerage nor a Realtor, Zillow’s business model is based on making money when it connects you to a Realtor. Realtor.ca connects you directly with the listing Realtor while Zillow connects you to the real estate professional who pays the most money for your information. In September 2018 Zillow gave a presentation to Realtors in Calgary, and the presenter said that the cost of leads can increase based on supply and demand. He also disclosed that leads in the US got, based on supply and demand, as expensive as $5,000 per lead. Realtors pay that money, for just one potential buyer or seller. However, a lead is no money in the pocket yet!
Zillow may make money in a few ways:
- Zillow sells your name and contact information to a Realtor for a dollar amount.
- This company gives your name and contact information to a Realtor. When this Realtor makes a transaction (either a purchase or a sale), the Realtor pays a percentage of their commission to Zillow.
- Real estate agents advertise themselves around the listings, even on listings that are not theirs. And the highest bidding Realtor gets your information.
You’re a lead to Zillow, not a person
Zillow connects you with Realtors who are only looking for leads.
Buying and selling homes is a major decision and should be made with professionals who prioritize your interests. It is also good practice to interview more agents and get to know the person you will be dealing with in the next months on the biggest investment of your life. Good agents don’t need to buy leads.
Instant home valuations are quick but not accurate
Some websites, including Zillow, promise you an instant home evaluation. But Zillow gives you a guestimate on your home’s value and uses old data to give the best guess. But they don’t consider all the factors that make your house unique – renovations, location, upkeep, how well the home shows and more. A comprehensive home evaluation takes hours of research to complete and considers the market conditions right in your community.
But when you fill out your address, immediately you have a report with the value of your home. And then your information gets directed to a random agent who is willing to pay.
We offer free home evaluations that are comprehensive and consider all the factors that make your home and community unique.
Zillow will show sold prices, which is already available
Zillow could also show the amounts that properties were sold for. This information is currently available from Calgary real estate agents. You can request a monthly market report showing you all the homes that sold in your community. The report includes images, the number of days on the market, the original list price and more.
Every time you buy or sell a home with us, we do an evaluation showing you other properties that sold. And we are happy to include an explanation of the trends in your community – we know Calgary’s real estate market.
Don’t expect big changes when Zillow comes to Canada
Zillow will be another way to view real estate listings – just like what currently exists at Find Calgary Home or at Realtor.ca. The difference is in how Zillow connects home buyers with real estate agents. Zillow makes big money by selling leads to real estate professionals and connects buyers with Realtors who want to pay for your information.
For Calgarians, Zillow won’t change how we buy and sell homes. Everything Zillow offers – from home listings to sold prices – is already available to Calgarians for free.