Zillow announced on Thursday it is becoming a buyer and seller through its Instant Offers platform, beginning in Las Vegas and Phoenix with Premier Agents this spring. Arik Prawer, formerly chief integration officer at Invitation Homes, has been appointed chief business development officer to oversee the participation of Zillow on the platform.
On Instant Offers, Zillow is going to be represented by a Premier agent in the area, and make improvements to properties, if needed, to swiftly turn around transactions. Zillow has chosen to enlist help in the process—a distinction from Opendoor and Offerpad—to “enable agents to earn commissions,” according to the announcement from the company.
In a CNBC interview on Friday, CEO Spencer Rascoff discussed the motivation to participate, noting he expects to have held between 300 and 1,000 homes for sale by year-end.
“We’re ready to be investors in our own marketplace, because what we know is that home sellers welcome a hassle-free experience,” explained Rascoff. “We think we have huge advantages because we have access to this huge audience of sellers [and] huge audience of buyers…that’s why we’re doing this.
“We’ve done this in a very industry-friendly way, and that’s why the reaction so far in the industry has been welcoming,” Rascoff said.
Instant Offers was introduced in May 2017 in Las Vegas and Orlando; with the announcement on Thursday, it has expanded to Phoenix. For its foray into Las Vegas and Phoenix, Zillow has partnered with Berkshire Hathaway HomeServices Arizona and Nevada Properties, Coldwell Banker Premier Realty and West USA Realty.
“Even in today’s hot market, many sellers are stressed and searching for a more seamless way to sell their homes,” said Jeremy Wacksman, chief marketing officer at Zillow, in a statement. “They want help, and while most prefer to sell their home on the open market with an agent, some value convenience and time over price. This expansion of Instant Offers, and Zillow’s entrance into the marketplace, will help us better serve both types of consumers, as well as provide an opportunity for Premier Agents to connect with sellers.
“This is expected to be a vibrant line of business for us and for our partners in the real estate industry, while providing homeowners with more choices and information,” Wacksman said.
“We’re always investigating new technologies to try to stay abreast of what the consumer needs and desires,” says Todd Menard, COO of West USA Realty. “[Instant Offers is] going to be providing us specific information as to what consumers are looking for…we’ll be very excited to see if consumers want to opt into it.”
“The expansion of Zillow’s Instant Offers program in Phoenix and Las Vegas will offer our executives a distinct competitive advantage,” said Gordon Miles, president and COO of Berkshire Hathaway HomeServices Arizona and Nevada Properties, in a statement. “As a Zillow partner, our sales executives will be able to compete with investor buyers, while offering one more option to service our clients. As a full-service brokerage, our priority is making sure our sales executives are there to guide home sellers and buyers through a streamlined, professional experience that gives the consumer the benefit of our knowledgeable expertise and the opportunity of this exciting service—a perfect blend.”
“We are tremendously honored to have been selected by Zillow as a primary partner in their expanded Instant Offers program,” said Robert Hamrick, chairman and CEO of Coldwell Banker Premier Realty, in a statement. “Coldwell Banker Premier Realty has a decades-long legacy of combining high-touch client engagement with high-tech innovations for fully-serviced home-selling and -buying experiences. Our agents are competing with investor buyers. As Zillow’s partner in the Instant Offers program, we are able to stay in front of changing consumer demands and provide clients an additional option when selling their home. Our brokerage is passionate about empowering our agents to best meet their clients’ needs. We are excited to be a part of Zillow’s program.”
With Instant Offers, homeowners enter information about their property, and, within two business days, get investor offers and a comparative market analysis (CMA) by a Premier Agent. For agents, the benefit is that they can earn listings of presumably ready-to-act sellers.
Eighty-seven percent of agents and brokers in a June 2017 RISMedia survey believed Instant Offers is “a shift by Zillow toward becoming a brokerage.”
“We have always felt, and will continue to maintain, that agents are a crucial part of the real estate transaction and our goal is to find ways to continue to integrate them in the transaction process, even as the process continues to grow and evolve,” said Zillow in a statement to RISMedia at the time.
According to Menard, consumers are after better experiences in real estate—a desire Instant Offers recognizes.
“I don’t believe that this is going to change the market,” Menard says. “What could happen is REALTORS® failing in delivering value to the consumer. Why would a consumer need to hire a REALTOR® if they didn’t need that experience?
“What we’re saying to our agents right now is, ‘Any time the consumer is made aware of new services [like Instant Offers], if you go in [to an appointment] and they ask you a question and you don’t have an answer for it, you’re not the expert in the industry.”
This article has been updated. Stay tuned to RISMedia for more developments.