More on Zillow
CNN has picked up the Zillow story about the NCRC complaint today.
I’m not surprised. This story was bound to get picked up by the big media. It’s timely and the issue of home valuations is an emotional one, especially right now when it’s announced Tuesday that the US house price fall was the steepest since 1970.
I have had a day to think about this a little bit more since the allegations first came out. And I believe my initial gut reaction was correct - this whole thing whiffs of opportunism.
The most telling part of CNN’s piece was Amy from Zillow’s comment:
She added, “We were never contacted by them before they filed the complaint.”
That stinks. Even the Bloodhound and sellsius blog, two of Zillow’s most vocal blogger critics have lined up in their corner on this one, calling it a shakedown. I tend to agree.
Unfortunately, this story could “have legs” and if it does Zillow could have a big mess to deal with.
The problem for Zillow is this sort of publicity calls into question the very accuracy of their Zestimates. Now they’ve maintained all along that Zestimates are only a “starting point” - but the implication with that statement is while they are not entirely accurate, there is some validity in their data. That’s their hook.
Zillow depends on John Q. Public believing there is a nugget of truth in the home valuations it presents on his house. That’s why they’ve enacting such a sophisticated marketing and PR campaign to get their spread their numbers far and wide. To get as many people to buy into the Zillow reality field.
The danger in this kind of allegations, and if they’re not answered aggressively enough, is that that the existence of that nugget could be called into question. And if enough doubt is sowed, Zillow’s entire business could be jeopardized. Without a nugget, what do they have?
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- From Zestimate Accuracy - Zillow Blog | Oct 27, 2006
- From the Property Monger » Real Estate Blog week in review | Oct 29, 2006
jf.sellsius | Oct 27, 2006 | Reply
For clarification, sellsius blog did not call it a shakedown, which implies illegality (extortion of money). We asked for proof before we’d jump on that bandwagon. If it’s proven to be such, we said we’d lead the picket line, arm in arm with David G. But we think it only fair to see actual proof of illegality before we accuse them.
I spoke to David Berenbaum, Esq., of NCRC, a consumer advocate lawyer of 20 years, who drafted the complaint and could not discern an ulterior (illegal) motive. I also read their mission statement & could not find any divergence from their stated goals. I also read the complaint & NCRC is not asking for money for itself. (A consumer would be required to prove damages in any case.) More needs to come to light before I call this an extortion plot.
And I certainly do not believe anyone would see Zillow as a shakedown target or an “easy mark”—that insults the intelligence of those running the good ship Zillow and those running NCRC. If NCRC is exposed as con men, all non-profit credibilty goes out the window. That’s just illogical IMO. Besides, you can only shakedown someone who has something to fear or hide.
Ultimately the FTC decides if the complaint has any merit & that’s the end of it. If it wasn’t NCRC it would have been someone else, eventually. If it was John Q. Public, the reaction might be different. Let’s not focus on who made the claim but instead look to see if any of it is true. I made this poor analogy: If a convicted murderer catches a thief, do we automatically release the theif? Let’s look at the proof before we decide either way.
Let us also be clear on our position:
We have always supported a consumer’s right to choose and Zillow’s right to be a choice. We also applaud Zillow for providing public data. But unlike Property Shark that provides the data & let’s you decide, Zillow publishes a zestimate, even when critical data is missing: In this example, Zillow would gain my respect by saying “How the heck do we know what estimate to put on this one? Sorry folks”
http://tinyurl.com/nv243
Try this move as a broker and you are called incompetent. Maybe Z should get a free pass for this, but not from us.
The zestimate is not public data & can be grossly inaccurate & if not taken down or corrected, we believe it can lead to problems for homeowners. David G is already on record as saying they would correct Steve Olshin’s grossly inaccurate zestimate—why not other homeowners?
So our 2 main criticisms of zillow have been (1)it buries the disclaimer & (2)it allows grossly inaccurate zestimates to be published without homeowners having any right to have it removed. Instead, they require owners to make corrections but still do not remove the grossly inaccurate zestimates.
It’s not even a question of asking for the disclamer to be added, it’s already there. The question is does it need to be in the same place where consumers get the pitch, on the home page? Only if it makes a real difference for consumers.
In some states, Brokers’ CMAs require a conspicuous “non-appraisal” disclaimer , but why exempt a zestimate? Maybe being free and on the internet should automatically mean “user beware”, with as little consumer protection as possible. If that’s the standard then no professional should have any problem understanding why consumers may not trust what’s on their websites. If the majority says that’s the way it ought to be, we accept the majority’s decision, though we disagree with it.