Does Zillow create more mistrust?
Wall Street Journal did an analysis of some 1,000 properties, those for that Zillow has "estimate" and then they were sold. The analysis shows Zillow has been off on average by 7%, which is not very bad for a computer software that never visits a house for which it estimates the price. However, what is problematic is the fact that it has been way off in many cases, sometimes as much as $2 million. Now, in this age of Internet, where buyers and sellers do their research online, before contacting a real estate agent.
Question is - what does this knowledge do? One can argue that when clients already have a specific estimate in their mind, and the real estate agent suggests a different value, there is a mistrust created right away. One can also argue that if the client is a seller and he had lower price in mind, and real estate agent suggests higher price, then the client will have increased trust. As the trust is a very difficult thing to gain, it can take long work hours for the real estate agent to gain that trust back. Now, Zillow like sites will be certainly very useful for the FSBOs. But one can argue that for home owners / buyers who still use traditional real estate agents for selling and buying, these sites create some challenges. Perhaps all real estate agents will have to first go through these sites, before going on an appointment with their clients.