Written by Deb Barnett.
Posted in Greater Lansing Business Monthly
Residential real estate is intensely local. With so much variance from area to area it is important to have a trusted local realtor to help you understand the dynamics of each market and each neighborhood. Despite using sophisticated valuation models, national third party web sites like Zillow and Trulia cannot provide the nuanced values or market trajectory that a knowledgeable experienced realtor can provide. The home evaluation tools on those sites, like Zestimates, are almost uniformly inaccurate and misleading. A local realtor whose business is referral-based and built on reputation can provide a thorough comparative analysis and the honest advice to arrive at a true value.
In a buyer’s search for real estate, local is also better. Eighty-nine percent of all buyers use the internet in their search process, but not all search sites are created equally.
A Seattle-based real estate company recently commissioned a study by the WAV Group, which essentially says the big online real estate portals like Zillow and Trulia lack listings and show out-of-date information. They are not members of the multiple listing services that provide real-time data. The study indicates that 36 percent of the listings on the national portals appear active when they are not. Despite providing a lot of information, the national sites provide frustrating search experiences because the data is often incomplete and outdated and buyers need to jump to other sites for more complete information. The national sites use listings to sell advertising and to sell leads to agents who are willing to pay for them. Local companies provide listings and tools to help buyers find the perfect home or successfully market their property. The findings are clear: local real estate company websites show the most homes for sale, recognize those no longer on the market and display listings much earlier.
From my experience, there is another service provider in the real estate transaction that should be local as well, and that is a locally-based lender. Local lenders offer a wide range of products including conventional fixed-rate mortgages, adjustable rate loans with terrific rates, construction financing, loans for homes sites and acreages, loans for rehabbing property, physician’s loans and jumbo portfolio loans. They offer in-house processing and underwriting, which expedites the process and loan officers have real life staff they can talk to in person. A key factor also is that local lenders often work with knowledgeable local appraisers who understand the market. When national lenders and online lenders use appraisers hired by appraisal management companies, some will bring in out of market appraisers who are willing to work for lower fees but do not understand the market. Local lenders, living and working in the market, have hands-on involvement, are careful about their local reputation and are committed to great service and prompt predictable closings.
They say in real estate it’s location, location, location. Additionally it’s local, local, local.