Appraisers... er... Non-profit Group Complains To FTC About Zillow's Electronic Estimates
from the those-poor-gullible-zillow-users dept
The real estate industry doesn't have the greatest track record in responding to attempts to make their industry a bit more transparent. Real estate agents have been trashing the book Freakonomics ever since it put forth some data about how the real estate business really works (and why an agent might not get you the best price for your house). It appears something similar may be at work in an FTC complaint filed against Zillow. Zillow, which launched earlier this year, collects a bunch of data and tries to estimate the value of a home. It's a fun toy, but even they admit very clearly that their estimates are a big guessing game and may not be particularly accurate (though, I've watched how they've valued the various houses for sale in my neighborhood, and it seems to do a pretty good job). Still, a non-profit organization, the National Community Reinvestment Coalition, which recently founded "The Center for Responsible Appraisals & Valuations" (made up of a bunch of appraisers, not surprisingly) has sent in the FTC complaint. The group claims it has nothing to do with their association with appraisers, but has much more to do with their need to protect people from getting in "trouble" via the site. Apparently, they're afraid that a low income person will somehow be tricked into getting a bigger loan than they need, all because of a bad estimate -- yet they don't provide any examples of that actually happening. Others, such as those who use Zillow, tend to think it's much more a publicity stunt by appraisers upset that technology is encroaching on their business. Still, it hardly seems likely that Zillow is going to hurt the business of appraisers (or trick many people into bad loans). Getting an estimate is exactly what it is: an estimate -- and it's hard to see why that should be blocked.