Okay here’s the good news: You have another opportunity to garner a do-follow link from Zillow.com.
And here’s the bad news: For that link to do you any good, your best bet is to be a really bad listing agent. The more listings you can accumulate on Zillow.com — which implies listings that don’t sell — the higher your ranking among your peers.
Yikes!
Or: Too frolicking stoopid…
Zillow’s Professional Directory is new as of this night, so — who knows? — maybe it will get better. In the neighborhoods we understand, it’s an exceptionally valuable glimpse into the world of lister dysfunction: Who can’t sell how much real estate how slowly? If you want to know for sure who cannot sell the greatest quantity of real properties over the longest spans of time, Zillow.com has the answer.
It gets worse: The “Top Zillow All-Stars” are, for the most part, bubbleheads. Everything is measured by contributions, where what Einstein does and a cat-box deposit are equally “contributions” — equally additions to Zillow.com’s great big cat-box of crap.
This is wicked-dumb, far dumber than the usual agent-rating schemes. Where those other “tools” can be gamed, Zillow’s system is based on measuring, first, a meaningless metric, and, second, by actually rewarding incompetence. Quantity not only is not quality, the number of listings a Realtor is carrying is very often a negative indicator — a symptom not of quality performance but of its absence.
Even acknowledging this, measuring velocity of turnover would not improve things, particularly since this is a metric that could be gamed. And even adding in true — meaning verified — list price to sales price ratios might not be enough. Readers here can correct me if they think I’m wrong, but I don’t think there is any reliable, objective way to rank Realtors by quality of performance.
And that’s as may be. It remains that graduating them by their inability to move product is inarguably a terrible way to rank real estate agents. The Professional Directory is a truly amazingly tone-deaf addition to Zillow.com.
As you might have deduced by my absence from these environs, I am very, very busy — with buyers, so my quality of performance would not even register on Zillow’s inverted thermometer. Since I may not be here to counter David Gibbons’ indefatigable flak-catching, I’d appreciate it if you would encourage him — politely — to improve this brain-dead “innovation.”
Technorati Tags: disintermediation, real estate, real estate marketing, technology, Zillow.com
John Kalinowski says:
Not sure how the number of listings you carry makes you a “bad listing agent”. Russell Shaw carries more than most anyone, and I certainly wouldn’t call him “really bad”. There’s an agent in my area who carries over 250 listings at any given time, and sells over $50mm per year. I’d be a fool to call her ineffective.
You can loose sleep over list price to sales price ratios, turnover rates, and any number of metrics, but agents like Russell sleep very well and never have to worry about how to pay for anything. Their families are quite secure, their bank accounts full of Benjamins, and their customers must have a certain level of satisfaction because the business keeps coming.
The reality is, do you want 30 really, really happy clients each year, and just enough cash to get by? Or, do you want 500 sales, some percentage of which are very happy, some not-so happy, and some unhappy, but your bank account is full, your business secure, and your family never has to worry about money again?
Any successful business will have a mix of happy and unhappy clients, and trying to only complete sales that will be perfect only limits your ultimate success.
October 2, 2008 — 4:54 am
J Boyer Chatham NJ says:
Glad to hear that you have been busy. I agree with what you are saying. Zillow is reaching out to try to show that they are adding value. Well is this value? Recently there was someone on City Data Forums trying to tell everyone they can determine where a house should be priced by looking at Trulia. I had to laugh, as this person is one of their resident REALTOR haters.
October 2, 2008 — 5:04 am
Joe Spake says:
The real question is: are consumers really naive enough to fall for this stuff? Its the same kind of thing as the point system in Active Rain, where many of the high scorers simply cut and paste from public documents. The ARs, Trulias, Zillows, etc. are attempting to allow REALTORS to retain their old hype business models, rather than being vehicles to get REALTOR marketing into the 21st century.
October 2, 2008 — 6:20 am
Barry Cunningham says:
In today’s market, obtaining listings is as easy as asking! Everyone it seems wants to sell their house.
Over 16,000 on the market down here in our neck of the woods. yet with an absorption rate of nearly 3 years having some listings is like waiting for a t-bill to mature. Yet we keep reading mundane posts about go out and get as many listings as possible becasue you control inventory!
Talk about self-serving commentary. I never hear a “lister” say they are serving a clients best interest by carrying a boat load of discount rack items on their books.
Just becasue you have listings does not mean they are going to sell. Ask the multitudes of expireds, withdrawns and cancelled listing holders down here. The old methodology of throwin as much sh$t against the wall and seeing what sticks is OVER!
Zillow’s directory is for those agents who innefficient in their own marketing, inexperienced in PR and advertising and are again looking for the easy way (see cheap) to try and gain some exposure.
I find it amusing that there are so many products and services and outlets that preach cheap or free and then the multitiudes gravitate to them.
But hey whatever, let them do it, keep them in their outdated mindset and it makes it a whole lot easier for them to be dominated.
Joe Spake…dead on!
October 2, 2008 — 6:31 am
Greg Swann says:
John K: We’re not talking about the same thing. How Realtors sleep is probably not the standard of value that matters most to consumers, and I’m pretty sure all of them want to come through the process happily. Zillow has chosen to rank Realtors by a standard that is much more likely than not to leave consumers unhappy, an inversion of the objective they set out to pursue. Anti-marketing is worse than no marketing, and useless standards are worse than no standards.
My own Zillow profile got clobbered, I know not why, but, even so, I’m a “Local Expert.” Why? Because we use a lot of photos on our listings. If I wrote back “Sez you!” to every noxious bubblehead comment, I’d be a “Top Zillow All-Star.” From the consumer’s point of view, every bit of this is arbitrary and stoopid — but the consumers won’t know to judge it that way.
This is actually worse than the Zestimate, which at least originates from useful, objective data. Zillow is basing its evaluation of real estate agents on standards that cannot predict consumer satisfaction, and, in the case of carrying vast numbers of unsold listings, will very often be a useful predictor of consumer dissatisfaction.
October 2, 2008 — 7:12 am
David G says:
Greg –
Zillow definitely needs more data about buyers’ agents roles in transactions before we can do a qualitative rating of buyers’ agents but don’t mistake listing and sorting for rating. If you have a list you unfortunately have to have a default sort but our users can re-sort the directory. And active listing count is not in fact the default sort order for the directory (it is an option.) I obviously agree that the count of an agent’s listings is not a definitive measure of expertise but a high listing count is not in itself a negative; if you are turning them it could be a GREAT measure of expertise. It’s very easy to tell who is and who isn’t turning over their listings by viewing agents’ listings in their profiles.
The default sort actually prioritizes recent activity on Zillow relevant to the specified location. Stale listings obviously don’t count towards recent activity on the site. A busy buyers’ agent who is actively zestifarming could certainly have enough recent activity on the site to outrank a poor performing listing agent with stale inventory. The reason we highlight the most active profiles is simply because consumers can learn a lot more from their profiles than they can about users who don’t contribute. We’ll tweak the default sort algorithm as we get more feedback so keep it comin’.
Zillow is not rating agents but note that we do have ratings for lenders in the Zillow Mortgage Marketplace. That has been working well both for borrowers and lenders and is used in addition to activity and geography to sort lenders in the directory. You should expect us to add more qualitative metrics and consumer feedback to agent profiles and this kind of critique is a good reminder of the importance of those projects – thanks.
October 2, 2008 — 7:34 am
Doug Quance says:
A top agent I know here in Atlanta used to carry 200 to 300 listings.
Today? 25. Why? To simply take a listing that will not sell only works if you can get BUYERS. And with very few buyers, servicing a ton of listings is not productive.
October 2, 2008 — 7:51 am
Garreth Wilcock says:
I see what you’re saying – I’ve though it myself while driving around University Hills in Austin, Texas. I see physical for sale signs, and note when a new one goes up for an agent whose listings are overpriced and stay on the market for ages. I wonder to myself how people find out about them – do they just look for signs and see that as a sign of a successful Realtor®?
I think it is possible to game any system, so you could indeed post useless comments all day long. If a consumer does their homework and examines the quality of the contributions, then they will get their own picture.
I guess it’s akin to walking in to a listing presentation and showing a handful of Customer Testimonials and then the homeowner leafing through them and finding them all to be blank after the first page.
I hope that more and more consumers are becoming educated about what constitutes an “all star real estate agent”. Someone who can meet and exceed their needs.
It’s our responsibility as real estate agents to make that education part of our process. It’s not for me to wonder about how homeowners find unsuccessful Realtors® (however you define that) in my area of expertise, but instead show them results and talk about what I do.
Garreth
October 2, 2008 — 11:04 am
A Catt says:
Typically, when I read about ‘rating’ agents, I start to yawn. No offense at the commentary, I think it was good if not great. Zillow.com couldn’t be more incorrect each time I’ve tinkered with it and whats more, is the fact that a lot of consumers that I speak with are mislead with its consistent inconsistancies.
Generally there is one that is left unannounced at [insert board of Realtors here] Circle of Excellence. It’s called NCI (net commission income). Typically you get a really cool award for GCI (gross commission income). Sounds like fun, especially when you see an award handed to a gal who scrapes by on charging far less for the same amount (yeah right) of work. But that’s not the point here.
The point here is that Zillow.com thinks credibility should be rated on metrics that have nothing to do with the process of homesales altogether.
I have never gotten a listing from having my picture on a biz card, city bus, billboard or most means of marketing that take the same shape. My listings come from referrals and meetings with clients who felt that I listened to their needs, understood their circumstances and showed a track record of getting things sold, not listed.
I’ll have to agree with Gregg on this one. I think this is just one more step backward for the industry and one more step forward (temporarily) for yet another industry leach to mislead evidently ignorant consumers about how to select a quality agent who can best represent their needs rather than an agent who can boast about a wharehouse full of listings that haven’t sold. It smells a bit like a cold box of McDonalds fries left in the car for a few days.
October 2, 2008 — 11:34 am
A Catt says:
John K Wrote “The reality is, do you want 30 really, really happy clients each year, and just enough cash to get by? Or, do you want 500 sales, some percentage of which are very happy, some not-so happy, and some unhappy, but your bank account is full, your business secure, and your family never has to worry about money again?”
You should include that in your Marketing Proposal to clients.
I think rule #1 for fast food is get em in get em out. Fortunately, we aren’t selling fast food – if we’re even selling at all. We are providing people with the tools they need to achieve certain life goals, find their dream homes, sell their properteies among other things. This is a business about relationships not quantity of units sold.
Certainly there will be clients who you just can’t please, I understand that, but if you look at the best, most successful businesses in the world, typically, Customer Service is priority number 1.
October 2, 2008 — 11:53 am
John Kalinowski says:
A Catt: You missed my point. Obviously we do our best for every client and make customer service our top priority. My point was that it doesn’t make sense to to try and make every listing perfect, and to turn down listings because they “might” not sell, or because you don’t think they’ll sell in one week. Obviously, if the price is ridiculously high, the seller is unreasonable, or just a jerk, you shouldn’t list the home. But if the pricing is close, and you feel there’s a good chance it will sell, it seems silly to me to turn it down because the market is slow, or buyers are better than sellers, or whatever other reason you can come up with.
Not every listing will be perfect, and you’ll have a certain percentage that don’t sell. That’s OK, and should be factored into your busines and spending plan. To think that you will always sell 100% of everything you list is either foolish, or will certainly limit the amount of business you do, and you’ll never make it to super-start status.
Ask any of the mega agents what percentage of their listings ultimately sell, and I’m sure none of them are anywhere close to 100%. This has nothing to do with whether or not they do an extraordinary job for their sellers, and receive lots of happy referral business. Most of them are excellent agents with superior customer service, and amazingly not every one of their clients will be happy. It’s just human nature.
Trying to only pick the perfect listings, so as to have a 100% sell record is just fine if that’s what you want, but my point is that your business will never grow to its maximum potential if you do. And believe it or not you can still do a great job for your clients, have high ethical standards, and sleep well at night by being a big listing agent. Even if Barry Cunningham thinks you’re an idiot for doing so!
October 2, 2008 — 12:33 pm
Michelle DeReentigny says:
Dang, Greg’s post almost makes me wish I weren’t a Zillow Allstar. I will put my listings where ever I may have the hope of attracting 1 more buyer to my inventory. I participate sporadically on discussions and have never posted an article, but I at least try to make sure the facts are correct on my listings and there are multiple photos. I’m a Zillow lover, it’s just another tool for me to use to my advantage.
I have a high sell to expire/withdraw ratio but I don’t expect it be 100%.
My days on market is rotten on some properties but there is only so much you can do with REO companies and short sale situations, in my opinion. Ironically the listing I have had the longest is a “short sale” that we have been negoiating for over 5 months now and it has been on the market for over a year and delayed from foreclosure twice. It is killing my stats, but I won’t abandon this seller because they have had a horrific experience.
Conversely, I have closed 2 sales in the prior 45 days in less than 14 days, so my average is still where I expect it to remain.
October 2, 2008 — 1:14 pm
A Catt says:
I think I understood you pretty well. Obviously a difference of opinion which is fine :).
The number of listings you have or the number of listings you sell has little to do with your net income as an agent. You have to factor costs, and these days, commission compression.
Case in point: I spoke with a new agent from Everett, WA who got his feet wet in the Seattle market. He was working with a mentor who was doing extremely well with listings. So well in fact, his GCI was nearly $750,000 per year. After working with this guy for a while, the new agent realized that in order to perform at that level it cost him over $500,000 dollars! So, perhaps he may look like a great agent on Zillow.com, but his NET, you know, the number businesses use to calculate value, was far lower than one might expect.
Why should that matter? Because, he wasn’t giving clients top notch service (all clients were new, no repeat or referral business) and you could actually say that he was in the business of making the ad agencies rich and make $250k year running around like a chicken with his head cut off in order to do it.
While that may be an ok business model for some, I can’t help but to think that the family of the agent and his clients were the ones who lost out. Just my opinion.
We can turn blue in the face trying to say what makes a super-star agent, but I think we can agree upon high quality customer service, exceeding client expectation, working honestly, working ethically and obviously providing for our families as something to strive for.
Personally, I don’t take over-priced listings. Not because I don’t like my sign out there snagging calls, or the circle prospecting opportunities, but because an over priced home in most cases won’t sell. I’m not in the business of not selling homes additionally that’s not what I was called in to do. I was called in to get the home sold. If my research shows that we are overpriced and the seller can’t see it, I say, “Perhaps you should find an agent who believes in your price with you”. Then, I look for a great referral agent.
Anyhow, the topic of this article merely points out how misleading it is to consumers that an agent who has 568 listings is better than an agent who has 20. That type of misinformation is far from ethical in my opinion. I stand by my support for the author!
October 2, 2008 — 2:05 pm
John Kalinowski says:
A Catt: $500k on a $750k GCI is 33% to the bottom line. I’m not sure what business world you live in, but I think most small business owners would love to see that kind of net!
If you read The Millionaire Real Estate Agent, you’ll see that they shoot for a net of about 42%, so it seems the agent you mentioned could probably get there with a little tweaking of overhead, etc. There aren’t many professional people in this world that make $250k per year, and I can bet that most real estate agents don’t net 33% after they consider all their true expenses.
October 2, 2008 — 2:17 pm
Keahi Pelayo says:
Thanks for the heads up.
Aloha,
Keahi
October 2, 2008 — 2:45 pm
J Boyer Chatham NJ says:
John Kalinowski, I have read the Millionaire Real Estate Agent as well. I agree with what you are saying
“If you read The Millionaire Real Estate Agent, you’ll see that they shoot for a net of about 42%, so it seems the agent you mentioned could probably get there with a little tweaking of overhead, etc. There aren’t many professional people in this world that make $250k per year, and I can bet that most real estate agents don’t net 33% after they consider all their true expenses.”
I know the numbers for Delaware, where I used to live. The president of the BOR there told me back in 2006 that 65% of the REALTORS there did not do 1 transaction in 2003, 2004, or 2005. Were they the same REALTORS each year? probably not but.. He also added that you had to go up to about the top 92% in order to find agents making more than 50K. Of course the top 2% were making hundreds of thousands or more. Just think how low that net is for the agents making 50K.
October 2, 2008 — 3:21 pm
John Kalinowski says:
J Boyer: That’s why I don’t understand why people try to limit their business volume. It obviously takes a lot of transactions to make a decent living in this business, unless you’re selling in an area where the average sell price is extremely high.
October 2, 2008 — 3:26 pm
Bob says:
yeah, that’s me. 😉
My only complaint is that the listing link goes back to listhub. David, how do I change that?
October 2, 2008 — 5:42 pm
A Catt says:
John,
How do you get $250 net? Take another 25-30% for taxes, might as well add transportation, property marketing, office fee’s and many other things. Even at your 24% you’re at $180k. Seems like a lot of work for $180k, guess we’ll have to agree to disagree.
How about the point of the post though?
October 2, 2008 — 10:04 pm
Mike Pannell ( Dallas Realtor) says:
Yeah i need to look into this directory. I dont have alot of listings so i might not do very well in it. We will see
December 16, 2008 — 4:10 pm