Most real estate investors spend countless hours searching the internet for the next great deal. This is because their livelihood depends on the accuracy of the data they collect and accurately analyzing the options in order to find a property that will give them a large return. For that reason, searching for real estate on nationwide portals like Trulia and Zillow can be catastrophic to your investment search. In the past year, many brokerages have decided to withdraw their listings from the nationwide real estate search portals. Here are a few reasons why real estate investors should stay away from these websites.
Slow Search Results
National portals such as Zillow are slow to show new real estate listings. When a property is listed for sale, it hits the local Multiple Listing Service (MLS) in an average of 15 minutes. On sites such as Zillow, it can take over nine days to appear, according to studies on the subject. By the time an investor sees the listing, it could already be sold, making them miss out on a prime investing opportunity.
Redfin, a real estate company, was hired to assess the accuracy of sites such as Zillow and Trulia and found that about 36% of the listings shown were no longer for sale on the local MLS, compared to 0% on local brokerage websites. Zillow also only showed 79% of the listings available, while local MLS sites showed 100%. To summarize, many of the listings you’re seeing aren’t actually for sale, and the ones that are for sale don’t always appear on these sites.
Inaccurate Pricing Tools
Zillow offers an estimate of the value of a home using a tool they call a “Zestimate”, and it’s predominantly displayed on every property’s listing page. Although this sounds like a helpful tool, it has been found that the Zestimate values aren’t even close to the actual values the properties sell for. It has been found that this Zestimate is within 5% of the actual sale price around 33% of the time and within 10% of the sale price 50% of the time.
Where to Look Instead
For those investors that are used to looking at Zillow, we suggest putting your attention into smaller, local brokerage based websites instead. You can also establish relationships with local real estate agents or get a real estate license and pay to join the local MLS where they invest to get the most accurate information possible. Having accurate, up to date information will allow you to have a competitive edge on the competition, especially those still searching on Zillow and Trulia.