Wed
Feb 22 2006
11:02 am

Last night WATE ran a bunch of breathless teasers about a shocking investigative report into a website that "lies" about your home value and operates in "secret" or something.

Normally I don't watch WATE or any other local "news", but I wanted to see what this was all about (although I suspected I already knew). As I suspected, the story was about the recently launched zillow.com website (mentioned here previously).

In an amusing touch, they used Knoxville Mayor Bill Haslam's home as an example. Zillow.com valued the house at $557K, while the Knox County property tax records website showed it was only appraisesd for $439K. Shocking! They said it wasn't a huge difference, but "enough." Enough for what? That wasn't explained. They did show his address, though, and what was presumably a picture of his house.

(Is there anybody who would sell their house for the appraised value set by the local tax assessor? And yes, I know the difference between "appraised" and "assessed"  value. And "market" value.)

The report said the website contains errors, isn't reliable, and doesn't take into account all the factors making up a home's value. Duh. They failed to mention that the site allows you to enter corrections for number of rooms, square feet, etc., and also adjustments for improvements or other features. They also failed to mention that the site shows you the comps (recent comparable sales in the neighborhood) it uses, and also lets you select your own, different comps if you want.

I imagine anyone who has ever bought or sold a house would find it a valuable tool but would also realize that it's just another estimate to factor in and not the final word. The few properties I checked seemed in the ballpark based on personal knowledge. At least one person here mentioned they found one that was way off.

Basically, WATE tried to present this as some evil conspiracy that you need to watch out for ("secrets" and "lies", oh my!). I wondered why they were making this into such a big deal. Then my question was answered. They interviewed a local Realtor, standing in front of his office with its big sign, explaining why these things can't be trusted and you need to work with a Realtor who can tell you about the neighborhood, schools, etc.

OK, but there are plenty of websites that offer that type of information, too. Realtors seem threatened by all this free and open access to information. I'm guessing they hate sites like zillow.com and sites like realtor.com that let you search the MLS yourself. It minimizes their role as "gatekeepers" and helps keep them honest. They don't tell you that they use similar sources, except they have access to more detailed recent sales information via their closely guarded MLS.

I have long believed that Realtors are becoming obsolete for lots of buyers and sellers. They provide a service, of course, and convenience, if you're willing to pay the 6% or whatever. I'm not sure what value they add for buyers any more, unless you are new to town and on a one-weekend corporate relocation house hunt. Their exclusive control of the MLS is pretty much their last "value-add" for sellers (well, that and showings). 

But investing a little extra time and effort doing your own research can save you big. (And for buyers can save you a lot of time being shown junk the Realtor hasn't been able to move.) And your mortgage company and their title company will help facilitate the transaction in the end, because they want every i dotted and every t crossed. Or you can just hire your own title company for a cash or owner-financed deal.

It seems to me that Realtors ought to re-think how they do business in the "information age" and if nothing else would appreciate working with better informed buyers and sellers.

What do you think? Are Realtors becoming obsolete?

(And would WATE be the goofiest local news outfit if it weren't for WVLT? Where do they find these people?)

SayUncle's picture

The last two personal

The last two personal residences I sold were without a realtor. Of course, that's because we happened to know folks looking for what we had. That saved us (or the buyer, depending on the contract) several thousands. The realtor's only value is the number of eyeballs they get to look at your house. Also, I think the title search lawyers are soon to be out of jobs with lexis and other legal resources the average joe can now use himself.

Checked the WATE site and couldn't find the article (probably not published yet). Be interested in reading it.

---
SayUncle
Can't we all just get a long gun?

R. Neal's picture

Uncle, I looked and couldn't

Uncle, I looked and couldn't find it either. I did Tivo it, though. Curiously, the "lies" and "secrets" they mentioned in their two teasers (which I did not Tivo) were not mentioned in their report.
SayUncle's picture

Well, I have to ask if it

Well, I have to ask if it was my good ol' buddy Tearsa Smith, who has a tendency to be, err, loose with the facts.

---
SayUncle
Can't we all just get a long gun?

R. Neal's picture

I checked. It was Melissa

I checked. It was Melissa DiPane. I had also remembered the numbers wrong on Haslam's house. Corrected.
smalc's picture

TV news

Shame we have to pick between a ripped-from the-tabloid headlines station WATE and the feel-good-never-seen-a-controversy station,WBIR (with the exception of their recent bizarre attack on the fire chief). 

I suppose there is another choice, or is WVLT still on the air? (just kidding)

Andy Axel's picture

Realty fealty

And their exclusive control of the MLS is pretty much their last "value-add" for sellers (well, that and showings). But investing a little extra time and effort doing your own research can save you big. And your mortgage company will help facilitate the transaction in the end, because they want every i dotted and every t crossed.

Honestly, the title company seems to be a lot more thorough than the mortgage company. When you go to close on a property, there are sometimes details that materialize in discussions which the mortgage company fails to outline up front.

But by comparison, in my first home purchasing experience, my realtor fell down on major details. I mean, like neglecting to mention when I needed to have insurance. Like neglecting to tell me about PMI. Like telling me that a FHA certification was pretty much the same thing as a home inspection. Like not having the correct amount to bring on the cashier's check for the closing, and then telling me a figure that was wrong.

This was Crye-Leike, by the way. I wouldn't use them to broker the sale of a birdcage. Yes, ladies & gents, CRYE-LEIKE. Don't use them. They suck.

And selling that house a few years later? Jumping Jesus. The wrong choice of realtor can lead to big, unpredicted expenses. Ever tried to insure a vacant home?

I did wind up with a good realtor -- one who found the right buyer and wound up making the sale of my house a break-even.

It seems to me that Realtors ought to re-think how they do business in the "information age" and if nothing else would appreciate working with better informed buyers and sellers.

What do you think? Are Realtors becoming obsolete?

I read that zillow.com was started by the same guy that started Expedia, and I think we all know what happened to the business of travel once Expedia got in the game.

I think that the business of buying & selling real estate has been in such a boom (involving fantastic sums of lucre) that it's been an incentive for a lot of sharks have gotten into the game. I don't know if it makes the better ones even better, or it makes them worse. I haven't traded enough in property to know all of the ins and outs. That said, I have been screwed royally a couple of times, though, and I can certainly point out some royally incompetent realtors who were involved.

They don't like their monopoly threatened. And if their stranglehold on information is stopped, then their perceived value will drop accordingly.

____________________________

If we heard mortar shells, we'd cuss more in our songs and cut down on guitar solos

R. Neal's picture

Now THAT'S some good gossip!

Now THAT'S some good gossip!
Oren Incandenza's picture

Why watch at all?

The only good reasons to watch local TV news are (a) to get a weather report and (b) to feel better about yourself.
edens's picture

I don't think realtor.com or

I don't think realtor.com or most of the other real estate sites list FISBO's (unless you're going through a service like Help-U-Sell). Smart realtors, particularly ones who specialize in niche markets, should be able to use the net to their advantage (it has certainly helped with marketing inner-city knoxville to out of town buyers). But most realtors aren't niche specialists, they're selling off the rack.
bizgrrl's picture

Oren Incandenza quote: The

Oren Incandenza quote:

The only good reasons to watch local TV news are (a) to get a weather report and (b) to feel better about yourself.

Too funny... I laughed out loud!

 

bjorn's picture

I think smart realtors are

I think smart realtors are adapting.  We attempted to sell by owner awhile back and just couldn't deal with the volume of calls and showings.  Plus, I am not a salesman and tend to talk too much.  After we found the house we were going to buy (random drive-by of an open house), we decided to use a realtor to sell our house and help negotiate on the one we were buying.  Our realtor gave us a pretty sizeable discount and sold our house within about 3 weeks, but only because the people who bought it went on vacation for a week.  After each potential buyer looked at our house, he either administered directly, or got their realtor to administer a survey asking what they liked/didn't like, etc.

That same realtor has a mobile office, including laptop with internet access, fax machine, and printer, all in the back of his vehicle.  He could download codes to his realtor key when needed, research, download and print documents, send and receive faxes, etc.  We did the initial negotiation in the McDonald's parking lot on Topside Road (South Knoxville).  He embraced the internet as a tool to assist himself and his clients.

 YMMV

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