But Zillow Says “Accepting Backups”
When something comes up three times within three days, I postpone the other blog post I was working on to address the more pressing issue. I am not sure whether Zillow just made this change or this is an example of the clumping phenomenon in chaos and complexity theory. Three days in a row I found myself in a phone or text conversation about a listing where Zillow is showing the words “Accepting backups.” In all three cases, the Sellers were not at all interested in showings or back up offers.
How Zillow Gets Their Information and What They Do With It
Listing agents are participants in an “MLS” or multiple listing service in order to share information with other participants. That creates a free market with properties for sale getting wide exposure to potential buyers so that everyone has the same information and sellers are sure they are getting market price. Once upon a time the MLS was a book that buyers needed to access by walking into a real estate office and talking with an agent. Of course the internet changed that, and both buyers and sellers have easy access to almost – but not all – the information available to real estate professionals.
When we list your property, the information gets entered into our MLS — and from there every single other website, whether one for an individual brokerage like Hawaii Lifeʻs site you are reading on right now, or any other third party site, pays to get the feed from the MLS. What they do with the data from there is up to them.
For example, most brokerage sites will show their own listings as “featured” or somehow serve them up first. The MLS will indicate whether a property is an “active” listing or already has an accepted offer. Even on the Hawaii Life website, a choice about properties in escrow has to be made for consistency. We have three different MLS systems across the state, and they do not have a consistent terminology for a listing which has an offer accepted but subject to contingencies. For the MLS used by the Big Island and Kauai, that would be “contingent.” For Maui, it would be “pending.” Here is how it shows on our website, using the terminology you would find on the Oʻahu MLS:
If “Accepting Backups” Is Usually Confusing and Inaccurate – Why Does Zillow Show It That Way?
Here is my hypothesis as to why Zillow is telling everyone that contingent/pending/under contract listings are “accepting backups” whether or not there is anything in the listing remarks to indicate that is so.
In a real estate market where across the United States we have an “inventory shortage,” if prospective buyers find few Active listings, they might get discouraged and go elsewhere. Zillow makes money through agent subscriptions. That means when you click to “find an amazing local agent” about putting in a back up offer, you are referred by Zillow and the agent pays a referral fee. My guess is that more prospective buyers click on properties accepting backups than on properties they think are already taken.
So what were the inquiries I received?
- The first was from buyer clients of mine who are in escrow. When they saw “accepting backups” they worried that the seller had doubts about their deal (the seller does not and is not looking for backups on this quick closing transaction.)
- The second was a prospective buyer who called me directly about the listing I am using as an example. Sorry Zillow, they did not go through you, but will be looking at alternatives with me next month when they visit the Big Island.
- The third was a prospective buyer already on island, frustrated that I donʻt have a bunch of listings to show him, but based on Zillow was convinced that I should be able to show him one that the listing agent tells me is a solid escrow and seller does not want any more showings.
Honestly, based on these examples, Zillow is also doing me a favor. I love to be in conversation with buyers and sharing correct information and expertise. Thatʻs the point of blogging as well.
In a market where inventory is tight, we real estate professionals understand and share your frustration! The best way to be first in line for a new listing that matches your criteria is to develop a relationship of trust with an agent who is knowledgeable about the market and type of property of interest to you. And who knows, maybe one of those listings “accepting backups” actually might be!