Zillow’s move to include “Coming Soon” listings has led to an industry-wide conversation about the potential of the strategy.
When someone wants something, there’s no better way to make him or her want it even more than by putting a sign on it that says, “Coming soon.” It’s like placing a birthday cake in front of a hungry child and telling them that they can have it, but not for another two weeks. Movie theaters do it; car manufacturers do it; and now, real estate agents do it, too.
It’s long been a tactic of marketers to entice customers by teasing them with the prospect of future options. And while it’s something agents and brokerages in the past have used to spur interest, it wasn’t until recently that the strategy started gaining major traction in the industry. Where familiar signs, like the red, white and blue of RE/MAX, used to singularly identify houses as being “for sale,” they now serve the added purpose of teasing interested buyers, saying simply, “coming soon.”
The larger implications of this trend on the industry are certainly up for debate, but Zillow, one of the major three listing syndication services, gave a big endorsement of the strategy – and turned a few heads – when the website unrolled its new “Coming Soon” feature, which, as the moniker suggests, showcases homes not yet on the market.
A Clear Divide
Throughout real estate, there seems to be two schools of thought regarding preemptive promotion: it’s good or it’s bad; there is little room for a grey area.
For those who subscribe to the method:
- The benefit comes in whetting the appetites of buyers hungry for options. In several markets throughout the country, inventories are still struggling to satisfy consistent demand, so giving them something to look forward to is an easy way to keep them interested.
- Zillow’s Chief Industry Development Officer Errol Samuelson argued that a “coming soon” label “is akin to giving [a property] a head start in the race to get sold.”
- The company says that it gives buyers a chance to “browse hidden inventory” and acts as an antidote to pocket listings, which occur when an agent covertly drums up buzz around a listing with other brokers before the property is on the open-market multiple listing service.
For those against:
- Opponents of the tactics, like the National Association of Realtors, admit that a ‘coming soon’ label could help ferry a listing to the front of the line, but adds that the exposure, in many cases, violates the ethical guidelines of local real estate associations.
- Many worry a seller will accept a pre-mature offer before realizing they could have gotten more on the open market.
- Indiana-based brokerage F.C. Tucker Co. told Inman News that Zillow’s “Coming Soon” service would violate the state’s licensing laws, which would subject the brokerage to hundreds of dollars in fines.
A Double-Edged Sword
According to Zillow’s new service, “Coming Soon” listings are most popular along the west coast, finding major traction in places like Seattle and San Francisco. Still, Zillow does report 19 such listings in Texas, three of which are in the Houston area.
To understand how this trend has, if at all, affected the Houston market, we talked with Robyn Jones, broker and owner of Robyn Jones Homes.
“As a listing agent, I absolutely love it,” she says. “I think it’s one of the best marketing devices currently out there.”
By preemptively promoting a listing, Jones points out how beneficial it can be to the seller. Not only does a “Coming Soon” sign give additional options to buyers who might be dissatisfied with the current market, but it helps garner additional offers and can incrementally increase home prices. Of course, to maximize the effectiveness of the method, agents need to follow guidelines of how and when to post to the local MLS. Unfortunately, she adds, many agents ignore these requirements.