It Costs Zilch

Yesterday I took an all day class. It was tedious, but it isn't the point of this post.

Realtor Jeff--who happened to be teaching the class--had a client who bought an investment home somewhere in the Phoenix metro area. The investor bought a home at auction for $250k, and decided for some reason he didn't want to flip it. The home, fixed up, was worth around $400k. So, he hired Jeff to sell it for what he paid: $250k.

Jeff in turn calls one of his investor clients who had been hounding Jeff for the deal of the decade. Jeff says, "I have a great deal for you. This home is for sale for $250k but is worth $400k once you flip it. Are you interested?"

What does the investor do? Does he ask to see the property? Does he ask for more information? Does he ask for sales comps? Nope, he immediately logged on to Zillow, which told him the house is worth $263,000 and what kind of stuff is Jeff smoking?

The guy missed out on the opportunity and Realtor Jeff found another investor who flipped the house for the mid-$400ks. The second investor may have looked at Zillow, but he also let Jeff do his job.

I recognize I am dogging the Big Z a lot lately, but only because I am seeing more and more consumers decide this is the gold standard of real estate knowledge. It isn't. It is a database with a few extra features. It has a purpose, but it doesn't replace common sense and true knowledge.

Z is free. You get what you pay for.