Ethical practices are a defining principle in the real estate industry. As agents and brokers, our word is our bond, our reputation our calling card, and any deviation from that is grounds for ostracism — not to mention losing one’s license and other professional credentials. Still, there are some unscrupulous real estate agents who seek to boost their fortunes through shady means, and Zillow Group is cracking down.
As of May 1, 2017, Zillow Group (which runs not only the Zillow platform but Trulia as well) is no longer accepting listing entries input manually by real estate agents. Instead, listings must be submitted directly by an MLS or brokerage. Why? Well, as it turns out, Zillow has several good reasons for making the change.
(It’s important to note that Zillow’s mandate doesn’t apply to FSBO (for sale by owner), “Make Me Move” (off-market properties listed to induce large offers), and “Coming Soon” listings, all of which can still be listed manually by either agents or homeowners.)
The Issue of Dual Agency
The current state of the housing market in many U.S. cities means that multiple offers and bidding wars are increasingly common. That makes for happy sellers, and it should lead to lots of satisfied agents, but some seller representatives are taking a different tact in order to better line their pockets. Listing homes exclusively on consumer-centric sites like Zillow and Trulia gives agents the ability to limit the properties’ exposure, thereby increasing the likelihood the agent could “double dip” and represent both parties in a potential sale. This limited audience is often to the seller’s detriment as fewer interested buyers means fewer offers, and that could negatively affect the final sale price.
Agents who seek to represent both the buyer and the seller are, by the very nature of the deal, unable to fully advocate for either client. While the practice isn’t technically illegal, most experts say that it rarely works out well — something with which Zillow apparently agrees.
The Battle for Accuracy and Timeliness
In an email to agents announcing the policy change, Zillow Group stated, “We are taking this step to provide buyers and sellers with the highest-quality listings data possible, and to provide agents and brokers with a simple way to market their listings.” It continues on to say, “Broker and MLS feeds are the best way to achieve this.”
The assumption, then, is that MLS and broker feeds are updated more frequently and, therefore, provide more timely and accurate information for buyers who get tired of calling about properties only to find they’re already in escrow or the price has changed. The concern some industry insiders have is that many MLS systems have their own inefficiencies concerning regular listing updates, bringing the efficacy of at least one goal of Zillow’s policy change into question.
Creating a More Comprehensive Database
Zillow Group is encouraging agents who currently manually post their listings to go through their MLS, as long as it already provides Zillow with a listing feed. If the agent’s brokerage or MLS doesn’t have a free feed with Zillow Group, now’s the perfect time for them to start — something the Zillow announcement email helpfully pointed out. These previously unconnected feeds suddenly pouring onto both the Zillow and Trulia sites instantly strengthens those platforms, which can only benefit the brand.
All in all, Zillow Group’s new approach to sourcing listings seems advantageous for buyers and sellers, especially in terms of cutting down on dual agency traps. As for more accurate listings, only time will tell.