Zillow will begin buying and selling homes using agents

Zillow will begin buying and selling homes using agents
The real estate tech giant is expanding Instant Offers to Phoenix and getting into the iBuyer business, going head-to-head with Opendoor and its own partner OfferPad
BYJOTHAM ​SEDERSTROM Staff Writer TODAY 1:08 P.M.
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Zillow executive Errol Samuelson announced a major new business initiative for the real estate tech giant in an exclusive video interview with Inman on Thursday: Zillow will finally expand its Zillow Instant Offers program to Phoenix and begin buying and selling homes with its own money there and in Las Vegas, putting it in direct competition with iBuyers like Opendoor and OfferPad — the latter of whom Zillow also partners with on Instant Offers.

Zillow Instant Offers, which launched last year in Orlando and Las Vegas initially, lets prospective homesellers visit the Zillow website to receive an offer on their home from iBuyer investors, including companies such as OfferPad, as well as a professional home valuation and comparative market analysis (CMA) from a licensed real estate agent. The home seller can then choose to take the instant offer from the investor and receive all cash for their home, likely at a reduced rate, or list their home on the open market with an agent and potentially get a higher sale price.

Zillow interview with Inman from Mo Moghari on Vimeo.

Zillow’s new enterprise — offering to buy homes outright and resell them, using handpicked local real estate agents who are already participating in Zillow’s separate Premier Agent program to represent Zillow in both its purchase of homes and its re-sale of them — will launch within weeks, according to Samuelson, Zillow’s Chief Industry Development Officer.

“Just like before, when a potential home seller says I’d like to get an investment offer for my home, we will provide an offer and alongside that we will again provide a [comparative market analysis] from one of our Premier Agents,” Samuelson told Inman. “Now, in the event that the home seller decides they wish to go for the instant offer, we’ll be working with a local agent at a local brokerage in the market to represent us as the buyer of the home and we will also recommend that the seller work with the local agent,” Samuelson added. “In fact, we’ll introduce the seller to one of our Premier Agent customers.”

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Samuelson declined to say how many home sellers in Orlando and Las Vegas had visited Zillow Instant Offers to request one in the 10 months since the program originally launched, but did provide some ratios that are likely to reassure real estate agents: one third of the sellers who requested an Instant Offer went ahead and sold their home, but 90 percent of them chose to list with a human agent rather than taking an instant cash offer from an institutional investor.

Samuelson said these stats highlighted how Instant Offers is a powerful lead-generation tool for agents.

Zillow will partner with West USA in Phoenix and Coldwell Banker Premier Realty in Las Vegas as they roll out the new iBuyer program over the next several weeks. Berkshire Hathaway HomeServices Arizona & Nevada will team with Zillow in both markets, Samuelson said. Zillow spokespeople said that homes re-sold by Zillow itself would be clearly labeled. A Zillow spokesperson also provided the following graphic used to illustrate how Instant Offers and its new program will work:

Graphic outlining Zillow’s new Instant Offers expansion. Credit: Zillow

Zillow employees declined to elaborate on how much money the company will spend buying homes through its new iBuyer platform. Nor did Samuelson specify how much it would pay out in agent commissions for the homes it buys and re-sells. Samuelson said that while Premier Agents would not be charged to participate in the new Instant Offers expansion, home sellers would be charged a fee, though he resisted quoting any numbers.

“The fee, we’re experimenting, so this is early days,” Samuelson said. “We have an idea of what those fees are going to look like, but those could change as we continue to explore and experiment.”

In his interview with Inman, Samuelson repeatedly emphasized that what separated Zillow from other competing iBuyers was its focus on keeping agents at the center of the transaction. However, both Opendoor and OfferPad also say they will work with seller’s agent. Zillow’s advantage may lie in its Premier Agent program, which last year generated $760 million in advertising.

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Opendoor, which has amassed $320 million in funding since launching four years ago, is in the process of raising an additional $200 million that would value the company at $2 billion, according to a reports in March. The additional funding, according to a report in The Wall Street Journal last month, would allow the rapidly growing iBuyer to purchase homes in the six metropolitan markets it currently serves — including in Phoenix and Las Vegas.

Armed with $260 million, OfferPad is also active in the Phoenix, Orlando, and Las Vegas metropolitan areas (as well as the metro areas of Dallas Fort-Worth, San Antonio, Atlanta, Charlotte, and Raleigh-Durham).

In a report by the investment banking firm Evercore released last year, analysts forecasted growing enthusiasm on Wall Street for iBuyers, who use new technology to make quick offers on homes and often close within days through reduced friction in the negotiating process.

“We believe that investors should familiarize themselves with this new business model, as these iBuyers are likely to garner increased attention over the next few years,” according to the report, issued in June. “If successful, these iBuyers could improve liquidity in the housing market by reducing friction costs, and drive increased housing turnover (existing home sales).”

Zillow recently has been riding on a wave of positive financial gains, tallying a $10.5 billion market cap in March for the first time since going public in 2011. Following a strong fourth quarter in which the operator of Trulia and StreetEasy posted a record $1 billion in annual revenues, some analysts indicated that in order to grow apace Zillow would need to innovate.

The entry into the housing markets in Phoenix and Las Vegas also coincides with the planned integration this month of the Premier Agent app with Zillow’s transaction management portal, dotloop. Analysts have said that the company could be banking on a lead conversion model that would potentially drive up ROI by accurately measuring agents’ conversion rates.

“In terms of proving out conversion rates — not just getting them, but proving out — it’s all about getting dotloop integrated into the Premier Agent app,” Ron Josey, an internet analyst with JMP Securities, told Inman last month. “Then they can actually say ‘Oh, okay, this is how many leads I got from Zillow and this is how many I actually closed in a month’ and that will help to prove out the value that Zillow is providing to agents.”

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11 Zillow hacks revealed from the inside

11 Zillow hacks revealed from the inside
Article from Inman Select – http://www.inman.com/2016/03/09/13-ways-to

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Over the past few weeks, Zillow has made a number of changes to its agent platform, leaving some agents confused as to what tactics will yield the highest return on investment.

Today, Zillow’s director of industry outreach, Andrew Hafzalla, shared 11 keys to success on Zillow during our inaugural “Slack Off Wednesday” chat series. Here’s what he had to say about making Zillow profitable for you:

1. Build a strong profile

Hafzalla says this is the most important part of success on Zillow, and it’s also the most cost-effective strategy. Profiles on the site are free and simultaneously seen on Trulia.

He suggests using a current headshot, crafting a detailed biography, requesting reviews, uploading past sales and adding digital content such as videos, links to your website and social media profiles.

2. Request reviews and upload your past sales

“Think of your Zillow/Trulia profile like your online resume,” Hafzalla says. “A resume that is displayed in front of the largest set of savvy consumers on the Web and mobile.”

He reminded attendees that today’s consumers are tech savvy and reading any information that is available through Google search or Zillow’s agent directory.

“Your reviews and past sales act as a way to showcase your success, helping drive more buyers and sellers directly to you,” he says.

In addition to requesting reviews, Hafzalla suggests responding to “all reviews, reinforcing the positive aspects of the experience.” He says responding is a simple courtesy to thank clients for their effort.

Furthermore, “People like to work with people they trust, respect and like, and saying ‘thank you’ is a likable trait,” he says. “It’s OK to demonstrate that you are a nice person.”

@Zillow agent tip #2: Request reviews and upload your past sales.
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3. Capture consumers by displaying yourself as the listing agent on your own listings

Hafzalla says agents should ensure they are being displayed as the listing agent on their listings.
“Consumers often reach out to the listing agent with questions, and most of the time they don’t purchase that particular home, ” he says. “Worked correctly, that consumer can turn into your client if you foster the relationship.”

4. Download the Premier Agent App

Agents can use the Premier Agent app to edit and customize their profiles and connect with leads on the fly. The app is free and can be downloaded from your Android or the iPhone store.

In February, Zillow released a new feature on the Premier Agent App that allows agents to make soundless two-minute videos of a for-sale listing.

“These walkthroughs help increase traffic to your listings as they sort higher in the search results,” Hafzalla says. “We also send direct mail to consumers with saved searches in the market where you upload your walkthroughs. Walkthroughs are incredibly easy to create and give buyers a sense of how the rooms connect in a home.”

@Zillow agent tip #5: Create and upload video walkthroughs for your listings.
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5. Partner with Tech Connect if you have a CRM you already like and use

Hafzalla describes the Premier Agent app as a mobile CRM, but he encourages agents who have a CRM they trust to continue using it and connect it with their Zillow profile through the company’s Tech Connect program. “These partnerships ensure that your Zillow and Trulia leads end up in the CRM of your choice,” he says.

6. Take advantage of Zillow’s Premier Agent advertising

Hafzalla says this is the best way for agents to “leverage Zillow Group traffic and drive awareness to you brand.” The advertising program works by targeting potential clients in a target ZIP codes.

“Millions of Zillow and Trulia consumers see you displayed on listings or they contact you directly from a listing or your profile,” he says. “Once they make contact, you then convert them into a client.”

7. Share your marketing costs with a lender

“Premier Agent advertisers can co-market with a preferred lender to share up to 50 percent of your advertising spend on Zillow and Trulia,” Hafzalla says. “Lenders pay Zillow directly and receive branding benefits alongside you, as well as the opportunity to receive direct contacts from consumers.”

@Zillow agent tip #8: Share your Premier Agent marketing costs with a lender.
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8. Use the Accelerate program

The Accelerate program is for agents who are already using Zillow’s tools successfully and want to increase their lead generation and conversions. The training sessions are infused with best practices and actionable advice from successful Premier Agents.

Currently, the program is only available to existing Premier Agents, but Zillow hosts webinars that include the same information from the Accelerate program.

9. Leverage Zillow’s research and download free Market Overview Reports for your local metro

“You can repurpose these and other free tools our team of economic researchers are compiling on your behalf,” Hafzalla says. “Utilize them in your listing presentations or share them on your social channels.”

10. Visit the Resource Center and Premier Agent Academy

Hafzalla encouraged attendees to use free tools in the Premier Agent Resource Center. The center has agent tools, scripts and templates, industry news, listing presentation tools and much more.

@Zillow agent tip #10: Visit the Resource Center and Premier Agent Academy.
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11. Connect with Zillow on social media

“We’re here to support you and hope you utilize Zillow’s tools to help you grow your brand, and make money from free and/or paid products,” Hazfalla says.

He suggests reaching out to Zillow via Twitter or other social media sites.

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