Zillow-Trulia Deal Effects on Real Estate in SW Florida

The simple answer is probably not much.  Zillow and Trulia are online portals meaning they take data from agents and brokers and display it to the public.  This is nothing new as agents display the data as well on their own websites.  Companies like Zillow and Trulia bank on the fact consumers will hit their site as they are nationwide versus agents who are in each local market.

 Zillow-Trulia Deal Effects on Real Estate in SW Florida
Zillow Purchasing Trulia for $3.5 Billion in Stock

Zillow collects money from agents who pay to advertise on their site.  They sell consumer leads to agents.  Agents basically pay for views in a zip code, or to have their presence as a featured agent on certain listings.

In the past year Zillow has been raising rates significantly.  So much so that agents are falling out and zip codes are becoming available right and left as agents decline to renew their agreements, so they look for new agents.  I get calls weekly telling me zip codes are opening up.

Let’s say Zillow’s traffic increases in zip code 33919.  Zillow sells chunks of impressions by the thousand, so if they find they have 3,000 more impressions in that zip code, they’ll sell 3,000 more impressions.  Agents used to get overflow but not now.  Zillow is diluting the lead generation and charging more for it.

If we used to pay about $400/mo for 10,000 impressions, Zillow has raised the ante.  They call now trying to sell me 3,000-5,000 impressions for $800.

Zillow has a problem.  They are raising prices and selling more impressions than ever before, but their net income is going the wrong way.  In fact, revenue increased 70% while net income was a loss of 6.26 million last quarter.

So what does Zillow do, but up #2 competitor Trulia. I looked up Trulia’s financial situation and last year revenue was up 142% while their net loss was 11.1 million.  So Zillow is purchasing Trulia for 3.5 billion in common stock.  Both companies are losing money.  How does this deal make sense?

Zillow says they can grow revenue and cut costs.  Of course they mean they’ll cut employees.  They intend to operate both businesses separately to try and generate more revenue.

If they raise prices too much agents will revolt.  I predict they’re going to sell more consumer data to agents in segments.  They’ll use more menu pricing whereby agents can purchase leads of sellers thinking about selling their home.  If you fill out a Zestimate on their website, they’ll sell those leads.  On Trulia if a consumer makes an inquiry on a home that lead info is sent out to multiple agents and it becomes a war as to who can hammer the consumer the fastest and most often to convert the lead.

We don’t think this is what the consumer is asking for when they go online.  The consumer just wants information without talking to someone.  They don’t want agents calling them hammering them with solicitation until they’re ready.

Consumers don’t like it when they’re information is sold.  Agents don’t like it when they receive a lead and it’s also distributed to other agents.  Real estate is a one on one transaction.  It’s personal and about trust, and this business model doesn’t recognize that.  It’s just money.  If a consumer wanted to be contacted by lots of agents they could just signup on multiple agent websites.  That way the consumer is consenting.

Zillow came to fame by providing home value estimates.  In the beginning these estimates were way off, and still are in many cases.  Agents and consumers alike complain that Zillow’s data is old and inaccurate.  Zillow and Trulia obtain information from multiple sources and it’s not always accurate.

We provide home value estimates on our website. www.Topagent.com  We also provide the MLS feed for searching the MLS.  The difference is it is accurate because it comes directly from the MLS.

The other difference is we don’t sell consumer data to other agents.  This is a big win for the consumer.

If agents spent the same amount advertising their own agent website that provides more accurate information as they do on Zillow and Trulia, that online business model would crumble.  In fact it already shows signs of it as neither is producing a profit.  As they raise prices on agents, agents may wise up and shift advertising dollars back to their websites, or sites like Realtor.com

You heard of the Internet bubble back in the 90’s full of online companies that had high valuation with no real net income.  This could be Zillow and Trulia if they don’t find a way to turn a profit.  They’ll try, and agents better be prepared to pay more.  Consumers should be prepared to be bombarded.  Whether this deal passes antitrust or not, these companies have to find a way to turn a profit.  Wall St won’t continue to pour money in forever.

So if you’re an agent and someone asks you how the  Zillow-Trulia Deal Effects on Real Estate in SW Florida

In the meantime, just remember Topagent.com in SW Florida.  We won’t sell your data and you can search away.  Then when you’re ready, call us and we’ll have a one on one conversation.  That’s a novel idea!

Read our Newest Article about how showings will change in SW Florida

View our July 2014  SW Florida Real Estate Market Update

To view our Listings in Hi Definition, visit www.HomesinHD.TV or click on our playlist below

Fort Myers Real Estate Agent

7910 Summerlin Lakes Dr

Fort Myers, FL 33907

SW Florida Home Prices Rise

Local numbers were just released and June 2014 single family home sales were up 8.1% over last year with a median sales price of $200,000.  That’s up from $185,000 last year and up from $195,000 last month.

SW Florida Home Prices Fort Myers Real Estate Market Update July 2014
SW Florida Real Estate Single Family Home Sales

Average SW Florida home prices have been holding steady all year around $300,000, bouncing between $299,000 and $319,000.  Median prices are definitely up for the year while average sale prices are level.

Listing inventory is falling as it usually does this time of year, however it is up from last year about 5%.  This is a positive sign and indicative of a healthy market. There will always be a level of homes that never sell because they are priced too high for what they offer.  Having more inventory creates visible competition for sellers.  When prices outpace the market, buyers shut off like a hose spicket. We have not seen that, but there is invisible competition coming to the market some sellers may not be aware of.

SW Florida Home Prices and Listing Inventory
SW Florida Real Estate Market Listing Inventory July 2014

We’ve been warning sellers for months that new home inventory is arriving.  Builders have been ramping up and we know of many new homes coming to the market and available starting in September.  These new homes will add to the inventory, but they won’t show up in the numbers.  Sellers won’t necessarily know about them, but buyers will.

Nationally inventories are at their highest levels in over a year which is tempering price gains.  We could see the same here in SW Florida heading into next year.  What’s different in SW Florida versus the rest of the country is the economy.  Locally we have positive driving forces.  Companies are hiring and relocating here.  Bringing higher paying jobs to SW Florida helps our median income.  Nationwide, wages are stagnant which keeps a lid on rising prices.

Traditionally SW Florida fares well against the national real estate market, although it does affect us to some extent. Some people need to sell up North before buying here.  In the past 7 years or so SW Florida trailed the national market, so it’s kind of refreshing to lead again.

Rising inventory is leading to increased sales.  We always said if we had more inventory we could surely sell it, assuming it’s fairly priced inventory.  If a home is priced over the market then it’s not really on the market.  We wish there was an index of inventory levels of correctly priced homes.

Several years ago we invented the Current Market Index which accurately predicts home sales going forward.  We’re working on a new index that measures inventory levels by price so we can determine how much of the current available inventory is actually on the market and how much is over the market and not truly available.

Next season buyers will have choices between existing homes and new homes built and ready for delivery.  We’ll be watching to see if builders can keep up the pace with delivery homes versus building on contract for a buyer.  The bottom line is this will cause sellers who wish to sell an existing home to be competitive.

Builders can offer a new never lived in home with new features, but they can’t always offer the same location.  There will always be a premium for location, i.e. west of 41 and closer to the beaches.  Many new communities are inland so the land costs will be less.

As always, if you want to sell you’ve got to price it correctly.  Many sellers are choosing to sell and purchase something else that fits their needs better today.  Interest rates are still low so it makes sense to do it now.  When rates change, some sellers may not want to make the move because the new home will cost more to finance.

The bottom line is the SW Florida real estate market is healthy and more balanced and our economy is good.  We’ll keep an eye on shifting forces and see which way it directs SW Florida home prices and by how much.

Good luck and Happy House Hunting!

View our July 2014  SW Florida Real Estate Market Update

To view our Listings in Hi Definition, visit www.HomesinHD.TV or click on our playlist below

Fort Myers Real Estate Agent

7910 Summerlin Lakes Dr

Fort Myers, FL 33907

Do Professional Listing Photos Really Matter?

We’ve been doing real estate a long time.  Long enough to remember the days when we’d go down to the board office and pickup MLS books on Tuesdays where each MLS listing had black and white listing photos in a book.  It’s hard to believe real estate was done that way even back in the 90’s.

Oh sure, agents needed at least one good photo of the front of the home for print advertising.  Some agents didn’t bother taking more photos than the front.  Then along came the Internet in the mid to late 90’s.  MLS’s started accepting more photos of the home, and agents started posting the entire MLS on their website like we do at www.Topagent.com  In fact, we were the first agents to put the MLS on our website back then.


Professional Listing phtos by Ellis Team
New Listing Coming to Market in August by the Ellis Team

I was searching through listings the other day and I came across some really bad photos.  Some were obviously shot from and iPhone because they had that narrow elongated tiny vertical picture you see, almost like a screenshot photo.  Other photos had cluttered counter tops or garbage all over the place.

I don’t want to call out any local Realtors or sellers so I won’t display those photos here.  I was just amazed that they’d put these photos online knowing full well that sites like Zillow, Realtor.com, Homes.com, Trulia, etc scrape that data and display these listings online, not to mention all the agents who display the MLS on their websites.

Listing Photos Example of Bad Photo of Listing
Bad Photo in MLS

Basically the world’s first and last impression of these homes is a series of crappy photos.  With more buyers starting their search online, why in the world would they expect a showing from these photos?

We since stumbled onto a website called badmlsphotos.com  Believe it or not there is a website dedicated to calling out sellers and Realtors for displaying bad photos online.  Much thanks to Barry Bevis who runs this site for allowing us to use one of his photos.

The Ellis Team takes photography seriously.  It all starts with hiring photographers who take excellent pictures.  Some homes can be tricky with lighting, both interior and exterior.  Having a pro can make all the difference, so we hired someone on staff with experience.  In fact, we have two full-time employees on staff with photography experience.  We also have a Photoshop expert optimize our photos for extra quality.

We created a website called www.HomesinHD.TV  Basically it’s our homes shot in High Definition.  We take professional photographs and edit them then combine them with full HD video and aerial photography.  The result is a Hi Definition video we use to market each of our listings.

Not only are these videos available on our website, but the high quality still photos and aerial photos are available on national sites like Realtor.com, Trulia, Zillow, etc.  We have the ability to place these photos into MLS so these aggregating sites pickup on our photos.

The photos your Realtor provides to MLS makes all the difference.  Buyers today are deciding which homes they want to see based upon their impressions from photos.  Many Realtors show homes online in their office and narrow down which homes their customers want to see.  This is one reason why each showing matters and many times buyers buy on day 1.

Buyers today are more informed.  They do their homework before contacting a Realtor.  They’re more ready to make a decision.  Just another reason why you don’t want to turn down showings and keep your home ready at all times, but that’s fodder for another article in the future.

Bottom line, hire a Realtor that takes photos seriously.  Your sale depends upon it.  The buyer takes them seriously, and so should the seller.

View our July 2014  SW Florida Real Estate Market Update

To view our Listings in Hi Definition, visit www.HomesinHD.TV or click on our playlist below

Fort Myers Real Estate Agent

7910 Summerlin Lakes Dr

Fort Myers, FL 33907

For Sale By Owners are at a big disadvantage and it’s not really the seller’s fault. There are several reasons why it’s hard to sell a home By Owner. The number one factor is Fear. Buyers have a fear about the process of buying a home and without an agent all those fears bubble up. They fear they don’t know the area as well as the seller. They don’t know the neighbors. Buyers may not know the schools, etc. They don’t usually know how to structure a contract, and they don’t know financing. Buyers have never lived in the home, but the seller has. Buyers feel at a big disadvantage, so their fear leads them to the second biggest issue, which is trust. Buyers become skeptical because they realize they’re not holding many of the knowledge cards; the seller is. The seller knows much more about the home and the neighbors than the buyer. There isn’t an agent as a go-between so there is a lack of trust. This lack of trust is born out of fear.

For Sale By Owner Fort Myers
Pitfalls of Selling By Owner

When you have fear and lack of trust, any potential transaction is shaky at best. The seller has fear and trust issues too. The seller also does not understand financing, insurance, etc. The seller is fearful that the buyer may not be able to qualify or is telling them the whole story. There is no agent to verify certain facts, so the seller must ask the tough questions themselves. Buyers don’t like to divulge confidential financial information to the seller as they would a seasoned professional like an agent. Buyers trust their agent; they don’t trust a seller they don’t know. The seller doesn’t trust a buyer they don’t know, and there begins the cycle of distrust, which elevates fear. Buyers and sellers don’t negotiate with other buyers and sellers everyday, all day long. The questions they do ask come across as personal, so they get evasive answers. Buyers and sellers treat each other at arms length because they know whatever they say could be used against them in the course of negotiation. Some buyers and sellers get cute and try to Buffalo their way with the other side. Even if they are better Buffalos, the other side typically reads they’re not getting the whole story. Complex issues arise in a transaction. Inspection issues can be sticky, not to mention insurance, survey, financing, HOA, and past permit issues, to name just a few.

For Sale By Owners Net Less Money at Closing

Recent studies have shown For Sale By Owners sell on average for 12% less than what a Realtor gets for a home. The only way a buyer would buy a For Sale By Owner is if they can save the commission and buy it under market. If they have to do all the work themselves and face that fear on their own without the help of an agent, they better get a bargain. However, the reason a seller wishes to sell By Owner is to also save the commission. Both the buyer and seller cannot save the same commission. If the seller is going to take the time to show it, advertise it, make signs, place ads, and pre-qualify each buyer they better get more than fair market value for their efforts. They must fight bank appraisers and they have nobody in their corner if they get a bad appraisal. They just lose another deal. So if sellers get on average 12% less for a home, why would they try on their own? A leading For Sale By Owner company CEO recently sold his home through a Realtor. If their company is so great, why did he resort to hiring a Realtor? Every seller wishes to maximize their bottom line but selling By Owner isn’t it. If it was easy everyone would do it. Not only is there a cost to taking less, there’s also a cost for losing deals and selling it over and over. And doing it all yourself can get discouraging. Buyers and sellers are also emotional. They don’t have a 3rd party intermediary keeping things real. Facts and logic get blurred and they can convince themselves of almost anything. If you’re thinking of buying or selling, do yourself a favor and hire a good agent. You can do it right the first time, or do it the hard way and try on your own. Hey, you might get lucky, but then again, it could turn out badly. It’s your choice. We don’t see a lot of FSBO’s today but they will always exist. We hope this article helps you analyze your options. Good luck and Happy House Hunting! View our July 2014  SW Florida Real Estate Market Update To view our Listings in Hi Definition, visit www.HomesinHD.TV or click on our playlist below Visit our Google+ Business Page Feel free to view our Virtual Tours . By Brett Ellis Fort Myers Real Estate Agent 7910 Summerlin Lakes Dr Fort Myers, FL 33907

Back in March we wrote an article about the benefits of joining a SW Florida boat club versus owning a boat.  The article was about people moving to SW Florida and debating whether to spend big bucks buying waterfront property so they could have a boat in their back yard.  Don’t get me wrong, I’m all for having a nice property and having a nice boat in your own backyard.

SW Florida Boat Club Carefree Boat Club Fort Myers location
Deck Boat at Carefree Boat Club Fort Myers


There are some costs for this luxury though.  First of all, you spend a lot more for the property.  Flood insurance may be higher too, as are property taxes.  Then you have the costs of the boat.

Perhaps you have a boat payment, a down payment, Sea Tow, insurance, licensing, maintenance, and of course depreciation.  Boats never seem to go up in value, only down.  Personally I hate cleaning up the boat after I come in from a day in the sun.  It would be so nice to just walk up onto the boat and it’s all gassed up and walk right off at the end of the day.

After writing the article I looked into this membership a little further.  For me it wasn’t about moving down here and selecting a property.  I already live here and love the life in paradise.  I don’t have enough equity in my home to make a move to the waterfront so that’s not even an option.

If I wanted to get out on the water I basically had just two options.  First, buy a boat and find somewhere to store it.  My garage isn’t big enough to store and trailer a boat.  Secondly, I could check out a boat club.

Advantages of Joining a SW Florida Boat Club:

My monthly payment with the boat club is less than what a boat payment would be.  I don’t pay for insurance, towing, storage, maintenance, tax, title, repairs, or anything.  I just pay for the gas.

Best yet, when I walk off the boat I just walk away.  They fill it up with gas, clean it, park it for the night, etc.  Our family just walks off happy and we have the rest of our evening.  It’s really a beautiful thing.

I don’t have to get the boat ready either,  Years ago we owned a boat and each time we took it out I’d have to go make sure battery is working, clean it up since it had been in storage, etc.  Today I just login to the online reservation system and reserve the boat and show up.  They have it sitting in the water all waiting for me.

My family just walks on and we’re off the dock in less than 5 minutes.  I just run through a quick checklist to make sure all the life vests are there and a few other things and we’re underway.  Most boats have a GPS unit, portable bathroom onboard.  My kids like the radio.

Blow up raft off Sanibel Island Florida
Enjoying a Leisurely Day at the Beach

We even bought a blow-up raft we tie up to the boat.  Last week we anchored off Sanibel Island and had a blast.

The boat club I joined has fishing boats, leisure boats, and more.  One has air conditioning and a cabin.  They’re adding boats to the fleet all the time.  My boys are excited about going fishing one of these days.

I joined Carefree Boat Club in Fort Myers, however I like that I have access to all the Carefree Boat Clubs across the world.  Next week I have a reservation at the Cape Coral location.  Basically it feels like I have joined two boat clubs because I have access to all the boats in Fort Myers and Cape Coral.

Our YouTube page has a nice video where dolphins were playing with us for about 10 minutes.  You might enjoy that video.  Joining the boat club has been great for my family.  Raising 3 teenagers and an 11 year old who thinks she’s a teenager can be challenging, and having something fun to do like going out on a boat is a great family bonding experience.

Taking the family out on a boat doesn’t have to cost a lot of money.  The time you spend making memories is priceless.

And remember, if you’re thinking about moving to SW Florida, you don’t have to spend an arm and a leg to live the good life.  Just get out there and make some memories.

Good luck and have a happy and safe 4th of July weekend.

To view our Listings in Hi Definition, visit www.HomesinHD.TV or click on our playlist below

Fort Myers Real Estate Agent

7910 Summerlin Lakes Dr

Fort Myers, FL 33907