Real Estate Misinformation and Extortion

Your money is at stake here.

Our lives are entangled with the internet.

But, can you trust the websites you rely on?

Entire industries have evolved because of the internet, but does that mean you can believe the information you find, even on your favorite “reliable” websites?

Is it wise to depend on the biggest, most well-known websites when you need good information to make decisions about your largest asset?

Your home is likely that asset, and bad decisions could cost you tens of thousands of dollars.

Value estimates are notoriously incorrect, and that is a topic for another day.

Agent rankings can also cost you, and hundreds of websites promise to help you choose the best agent, but behind the scenes it can get pretty ugly.

Real Estate Misinformation and Extortion

Thousands of companies’ business models can be summed up simply “Get money from agents”.

What if you couldn’t actually trust the websites that claim to be giving you great information?

If agents can “pay for placement” does that influence how reliable the rankings are?

Are customer reviews a better indicator than computerized or “professional” recommendations?

I don’t have all of the answers, I am just going to give you a bit of my personal experience with the top websites, and encourage you to ask good questions and tread carefully.

Many real estate agents lose their minds when you mention Zillow. Why? Here are some responses:

  • “The Zestimates are way too high!” (Or way too low);
  • “The listings people call about don’t exist!”
  • “I get calls from Zillow all the time! No, not customers: salespeople. Trying to sell me leads, ads, upgraded profiles and websites. All they want is my money, money, money!”

I have been a full-time, licensed real estate professional since 1995. I set up my free profile on Zillow, the largest real estate website, 7 years ago. So what is my personal experience? First, I can relate to the above issues. But the “Ratings and Reviews” is even more interesting to me, because after all these years, Zillow still hasn’t figured out how to obtain my past sales data. They show that I have completed two sales. Total. In twenty years. Wow! I am a beast!

I actually have more reviews than I do past sales. Fortunately I am “Five Star Rated” by my past customers and clients!

These sites are very popular, but they are not very accurate! While Zillow has me with a total of two, Trulia has me currently listed as having completed only one (1) sale during my entire twenty year career! This is from the number one, and number two real estate websites (who are currently merging to become a super-sized gorilla).

So, is the problem that I have not paid them to make my information accurate? Possibly. I have called them and they tell me they will update my information and it will begin to fill in, but I didn’t pay them, and nothing changed. There is a free option to load my past sales into the system, and I will have to work on that angle.

Trulia says I don’t have any reviews, but there are seven on the site. However, I don’t have any ratings because the reviews were added by folks before the ratings featured existed.

Millions of people go to these sites every month. I would like to ignore them, because the information is factually-challenged, but I can’t do that when most of my potential customers are on these sites.

There is a big plus to not having sales on these sites: the extortion sites are not yet gunning for me! Yes, there are real estate sites that will do ANYTHING, legal or otherwise, to get money from agents. The most notorious will simply give you a bad rating, and then send you an email alert that you have a bad rating. Because they are generous and upstanding (cough, cough) you are given the opportunity to have the information “updated” for a fee.

When enough complaints come in, a court case is threatened. This may quench one fiery dart, but hundreds of new websites pop up regularly to “get money from agents!”

One website that is frequently mentioned in the Realtor discussion groups as promoting misinformation is still in the “flattery” stages with me. They have me ranked as a “top listing agent” in a town that I have never had a listing in. Or even a sale. They suggested that I pay to promote my status, but haven’t gotten ugly with me yet. Probably because Trulia and Zillow show I only sell one home every ten or twenty years.

I am a bit concerned that I will rank higher on the “extortion index” if I get more of my sales listed on the primary sites. I have had hundreds of sales in my career, so these fiends could decide that I am a better target as time passes.

However, the multiple listing systems have changed in both of the markets I have worked. It may be hard to validate past sales on websites when the MLS says they can’t pull the data themselves from the previous system. Hmmm….

Oh well. I will still get calls and emails from all of these companies every week. And the occasional inquiry from a live person about a listing they saw online. Realtors hate these calls because it perpetuates a credibility problem.

Picture this common scenario:

Someone calls asking for details, or to see a new listing they just found online. The agent looks it up and tells them it sold months ago, or is not actually a listing at all.

The caller repeats, “I just found it today as a listing online.” The agent responds, “It is just a public notice that the owners have fallen behind on their mortgage. The property is not for sale, and the bank won’t actually own it through foreclosure for several months (or years here in Florida).”

Who is the public going to believe? The information provided by a famous, publicly-traded website with a market capitalization of Billions (with a “B”!) of dollars; or some unknown real estate agent who happened to answer his phone when they were calling around for more details?

Be careful, folks! There is a wealth of information, and misinformation, available online. Find someone trustworthy to help you make sense of it all. It could mean thousands of dollars in your pocket!

Respectfully,

Jim Sweat, ABR, CRS, CDPE, GRI, e-PRO, ILHM

REALTOR

Author of REAL ESTATE CSI: CONTROVERSY, SECRETS, INSIGHT (available 2015)

American Realty of Venice, Inc.

700 W. Venice Ave

Venice, FL 34285

941-484-8080

http://myfloridahomesmls.com/JimSweat Home search

www.linkedin.com/in/jimsweat LinkedIn

http://www.trulia.com/profile/jimsweat Trulia

https://www.zillow.com/reviews/write/?s=X1-ZUyz3incawqo7d_93ahq Zillow

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4 thoughts on “Real Estate Misinformation and Extortion

  1. A realtor had me sign blank forms , sold my property on NY eve to an investor (for over 100K below fmv) my things/property are still in the condo and now first team is threatening to “hold” another property I own until escrow closes……(a renter lives there, this property had a 1000 dollar cash flow for me and I will not be making any profit whatsoever) Can they do this?

    Like

    1. Hi Fran, This doesn’t sound right. Not having many details, you should contact a real estate attorney right away. A legitimate Realtor should never have you sign blank forms and then fill them in to your detriment later, that would be a violation of the code of ethics, and you can file a complaint with the local Board of Realtors. One problem, not every real estate agent is a Realtor, so the code doesn’t apply. There are still state laws that do not allow fraudulent activity. Contact someone quickly!
      Best of luck to you,
      Jim

      Like

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