If you’re thinking, “Those property estimate generators are so inaccurate.”, you’re not alone. Most real estate agents think the same way.
They have existed for years, and homeowners are using them – a lot.
Realestate.com.au’s recent campaign push for its realEstimate™ product is hitting billboards, TV and other media throughout Australia, essentially a rebadged and branded version of its previous ‘property value’ tool.
It’s one of the biggest questions homeowners have on their minds, whether they’re thinking of selling or not: “What’s my home worth?”.
The ability to quickly spin up a property price estimate on a well-known platform is, well, easy. So this campaign will likely see hundreds of thousands of homeowners handing over their information to answer that burning question.
But here’s why that’s not such a good thing for consumers who are thinking of selling
Recently I was meeting with one of Australia’s most high-profile agents where we were discussing computer-generated price estimate models (or AVMs). We entered the address of one of their current listings into a price estimate tool which returned a “high confidence” estimate of $2.5m (mid-range) and $3.2m (high-range).
Here’s the thing… the property was currently under offer for $3.5m with multiple offers.
There would no doubt be many cases where the opposite would occur, and a property is sold for a price at the lower end of a computer-generated estimated range or right within the estimated range. But conversely, there are many instances where a property sells for much, much more.
This is the problem.
Passive sellers who are using these tools might think twice about selling after generating a computer-generated price estimate for their property, and they could potentially miss the market completely and eventually sell for less.
There is a reason why they are called estimates – that’s all they are. An appraisal from a reputable agent is the only way to get an accurate assessment of the potential selling price of a property in ‘today’s’ market and had those homeowners spoken with an agent, they may have achieved an outstanding result.
This is why it’s so important to consider putting a price estimate tool on your own website and promoting it to as many homeowners in your local market as possible.
On every other website, no one is educating consumers on the importance of an agent appraisal to get a true reflection of a potential selling price. Most online platforms use price estimate tools for consumers to compare their current home loan or discover how much equity they might have. The primary objective of these platforms is not necessarily to generate vendor leads.
By putting a price estimate tool on your own website, however, you have an opportunity to inform potential sellers of why an agent appraisal is the only way to get a true reflection of current market value.
The price estimate tool can be an effective way to turn homeowners (who weren’t thinking of selling) into potential sellers by helping them understand the true value of their property. At the very least, you’re educating consumers on why computer-generated property estimates aren’t necessarily an accurate reflection of market value.
On average, ~10% of people who request a price estimate from a real estate agency’s website go on to request an appointment with an agent directly from the price estimate report they receive in their inbox. These people may not have even considered requesting an agent appraisal, so the price estimate tool can significantly increase the number of appraisal requests that your agents receive.
Not all price estimate tools are equal.
If you’re thinking of putting this tool on your website, be sure to do your research.
Some price estimate tools will allow third-party data providers access to all of the information that is entered into the form on your website i.e. names, email addresses, phone numbers etc. From a data control/ownership point of view, you need to decide if you’re comfortable with this.
Also, some price estimate tools are ‘script based’ – meaning you’ll need to embed code onto your website that allows this tool to function. This can impact your website performance and if, for some reason, that third-party’s servers go offline, their price estimate tool will no longer function on your website.
We recommend having these tools coded directly into your website by a qualified web developer where you control all of your data, the design and the experience for consumers.
When it comes to the design of the price estimate tool itself, asking some additional questions can help improve the quality of the leads you receive. The design, speed and user experience of your form sequence here are crucial to the success of this feature, so it pays to work with a web developer who can implement these steps for you.
‘Build it and they will come’ is NOT a strategy!
Simply adding a price estimate tool to your website will not, in itself, flood your business with leads. You should promote it across multiple channels, online and offline, and remarket it to people who you have previously interacted with to get maximum exposure of this powerful feature on your website.
Here are just a few ways you could promote the price estimate feature on your website:
DL Cards with QR codes directing people back to the landing page on your website:
The best people to educate consumers on the current potential sale price of their property is you. You are the expert. You are the ones on the front line of real estate every day. Instead of thinking, “those price estimate tools are wildly inaccurate”, embrace it. Use it as an opportunity to educate consumers on why they need YOU.
Real estate websites are no longer the static online brochures they once were. By putting the user in full control of the experience, conversion rates on your website will most certainly increase. Static pages with a simple web form asking people to provide their information and then waiting for someone to contact them will no longer cut it.
Sellers and buyers alike are craving more personalisation, more exclusivity and more privacy than ever before – something that only your website can deliver over all other platforms on the web. Great digital marketing starts and ends with a great website and it could be the difference between winning or losing your next listing.
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