Hundreds of homeowners have received investor bids since Zillow launched Instant Offers, but none had been accepted as of June 5.
On the other hand, the program has generated three listings for one agent, and she may be able to convert more Instant Offers leads in the days ahead.
The results suggest that Zillow Instant Offers investors are not making compelling bids — an outcome that Zillow Group may have been anticipating. The real estate giant has found a way to generate new business for its customer base, while positioning itself to potentially capture fees if consumers embrace high-tech investors in the future.
“We kind of thought that more people would elect to go with an agent,” said Zillow Group spokesman Dan Evans.
Zillow Instant Offers, a test product that Zillow is piloting in Orlando, Florida; and Las Vegas, allows homeowners to receive quick offers from multiple investors alongside a comparative market analysis (CMA) from Zillow agent advertisers. Each CMA request is a seller lead for an agent, not just an acquisition target for an investor.
Zillow currently does not charge any fees for the program.
While hundreds of people had requested bids through Zillow Instant Offers, “We haven’t had anyone choose an investor offer yet,” Evans told Inman on June 5.
Asked June 7 if that that had changed, he said by email:
“In regards to investors, you asked if any offers have been accepted. There are a few more steps to the process than that, and it’s too early to share hard numbers, but we are aware of some conversations happening between potential sellers and investors.”
Veronica Figueroa, one of the agents receiving leads through Instant Offers, had received about 50 CMA requests as of June 2. Of those requests, Zillow Group said it had only delivered 27 CMAs on Veronica’s behalf.
The discrepancy is partly because some of the leads came from agents testing Instant Offers.
“We’ve realized we can cross check and verify if this is an agent,” Figueroa said.
Zillow Instant Offers has raised the hackles of many agents. Critics say Zillow Group has broken a promise not to step into the middle of the transaction and worry that Instant Offers might popularize an alternative to listing brokerage.
NAR recently disparaged the program, but antitrust laws prevent the trade group from taking aggressive action.
While iBuyers such as Opendoor and OfferPad have gained traction in some markets, the early results of Instant Offers may allay some of the tension in the industry.
Figueroa has been heartened to learn that consumers appear more likely to take a chance on her, rather than accept investor bids.
“The one that I did meet with in her home — she was so sweet and basically gets it,” Figueroa said. The homeowner told Figueroa she wanted “an agent to be able to hold my hand.”