$4,500 for 5 Zillow Leads....

[Ryan Cleary]

I was contacted by a Zillow sales rep about becoming a premier agent. I know the reputation Zillow leads have, but I was curious to have a conversation. I could not believe what he told me...

For 5 leads a month in my market, the price is $4,500... I could not believe that. Even the best agent has a slim chance of converting even one of these leads to a paycheck. I suppose there is a reason agents are doing it but I cannot see this as a profitable endeavor...

[Bob P.]

Quote from @Ryan Cleary:

I was contacted by a Zillow sales rep about becoming a premier agent. I know the reputation Zillow leads have, but I was curious to have a conversation. I could not believe what he told me...

For 5 leads a month in my market, the price is $4,500... I could not believe that. Even the best agent has a slim chance of converting even one of these leads to a paycheck. I suppose there is a reason agents are doing it but I cannot see this as a profitable endeavor...

Seems high to me. Does he have references you can talk to?
For $4500 a month I can do a lot of marketing and for sure find two off market deals.

[Ryan Cleary]

Quote from @Bob P.:

Quote from @Ryan Cleary:

I was contacted by a Zillow sales rep about becoming a premier agent. I know the reputation Zillow leads have, but I was curious to have a conversation. I could not believe what he told me...

For 5 leads a month in my market, the price is $4,500... I could not believe that. Even the best agent has a slim chance of converting even one of these leads to a paycheck. I suppose there is a reason agents are doing it but I cannot see this as a profitable endeavor...

Seems high to me. Does he have references you can talk to?
For $4500 a month I can do a lot of marketing and for sure find two off market deals.

The two I spoke to was super cool agreeing with me that the numbers were difficult.

Ive used the Zillow leads in the past (I think it was $350 a month for a 6 month contract in 2020) and did not convert a single lead. In fact most leads were not actually leads.

I'm more so surprised at how much they are charging now and the fact that some realtors pay this amount of money for so few leads

[Doug Smith]

We have both a realty practice and mortgage practice. That is one of the reasons we quit advertising with them. We were pumping $7500-$8000/mo into Zillow Real Estate Leads several years ago when we were getting about a 4.17X ROI. Over time, they raised prices, cut the lead amounts, and had their Internal telemarketing team make the first contact and then tried to "warm connect" us. Our close rate and ROI plummeted to around 1.5X. It simply was no longer worth it and we jumped too. You're not alone.

[Ryan Cleary]

Quote from @Doug Smith:

We have both a realty practice and mortgage practice. That is one of the reasons we quit advertising with them. We were pumping $7500-$8000/mo into Zillow Real Estate Leads several years ago when we were getting about a 4.17X ROI. Over time, they raised prices, cut the lead amounts, and had their Internal telemarketing team make the first contact and then tried to "warm connect" us. Our close rate and ROI plummeted to around 1.5X. It simply was no longer worth it and we jumped too. You're not alone.

 Kind of a sad practice, preying on the small business owner...

[Russell Brazil]

Standard conversion rate is 2%. So you need about 50 leads to convert to 1 transaction. So 5 months at 50 leads would be $45,000. What's the average commission in the zip code offered? Would need to be a very high priced zip code for the math to work out here.

[Joe S.]

Quote from @Bob P.:

Quote from @Ryan Cleary:

I was contacted by a Zillow sales rep about becoming a premier agent. I know the reputation Zillow leads have, but I was curious to have a conversation. I could not believe what he told me...

For 5 leads a month in my market, the price is $4,500... I could not believe that. Even the best agent has a slim chance of converting even one of these leads to a paycheck. I suppose there is a reason agents are doing it but I cannot see this as a profitable endeavor...

Seems high to me. Does he have references you can talk to?
For $4500 a month I can do a lot of marketing and for sure find two off market deals.

Bob P  I’m not an agent, but I have done a lot of my own marketing to find sellers willing to sell me their house in a manner or price that would make sense for me.  There’s been many times I have spent way more than $4500 without finding a deal. Please share how you can find two off market deals for $4500 if you would be so kind. 

[Ryan Cleary]

Quote from @Russell Brazil:

Standard conversion rate is 2%. So you need about 50 leads to convert to 1 transaction. So 5 months at 50 leads would be $45,000. What's the average commission in the zip code offered? Would need to be a very high priced zip code for the math to work out here.

 Sounds like a good way to go broke!

[Bob P.]

Quote from @Joe S.:

Quote from @Bob P.:

Quote from @Ryan Cleary:

I was contacted by a Zillow sales rep about becoming a premier agent. I know the reputation Zillow leads have, but I was curious to have a conversation. I could not believe what he told me...

For 5 leads a month in my market, the price is $4,500... I could not believe that. Even the best agent has a slim chance of converting even one of these leads to a paycheck. I suppose there is a reason agents are doing it but I cannot see this as a profitable endeavor...

Seems high to me. Does he have references you can talk to?
For $4500 a month I can do a lot of marketing and for sure find two off market deals.

Bob P  I’m not an agent, but I have done a lot of my own marketing to find sellers willing to sell me their house in a manner or price that would make sense for me.  There’s been many times I have spent way more than $4500 without finding a deal. Please share how you can find two off market deals for $4500 if you would be so kind. 

Sure, first I am not an agent and I don't use the MLS. I'm not a wholesaler, so I am not looking for 70% LTV deals. I'm not using SEO or PPC. I am not fishing in the same hole where the majority of people believe the deals are ( major cities).

I have simply isolated one slice of the pie that few people are interested in (which also provides cash flowing, low equity, taking over the loan, selling on lease option) so there is much less competition. I have an approach that went out of favor a while back for being heavily over used, so people turned away from it, but it is now producing again.

There is nothing new under the sun. It's just a different part of the cycle approached from ways that apply to this environment and will apply until the housing market breaks loose, which I believe will be after 2026.

[Alan Asriants]

That is absolutely nuts...

We had Zillow and they kept upcharging and the lead quality went down. Plus the market became so oversaturated with agents. There was a point in time that you could have a market share out of 200+% 

Made no sense. Overpriced. 

I hope @biggerpockets doesn't oversaturate leads!!!!

[Gustavo Munoz Castro]

Zillow is trying to make more money from a lower amount of leads, this is not even the most expensive I've seen.

[Don Konipol]

Quote from @Ryan Cleary:

I was contacted by a Zillow sales rep about becoming a premier agent. I know the reputation Zillow leads have, but I was curious to have a conversation. I could not believe what he told me...

For 5 leads a month in my market, the price is $4,500... I could not believe that. Even the best agent has a slim chance of converting even one of these leads to a paycheck. I suppose there is a reason agents are doing it but I cannot see this as a profitable endeavor...

I believe that Realtors who sign with Realtor.com leads pay a percentage of their commission to Realtor.com if they successfully close the deal - something between 20 - 40%. 

[Ryan Cleary]

Quote from @Don Konipol:

Quote from @Ryan Cleary:

I was contacted by a Zillow sales rep about becoming a premier agent. I know the reputation Zillow leads have, but I was curious to have a conversation. I could not believe what he told me...

For 5 leads a month in my market, the price is $4,500... I could not believe that. Even the best agent has a slim chance of converting even one of these leads to a paycheck. I suppose there is a reason agents are doing it but I cannot see this as a profitable endeavor...

I believe that Realtors who sign with Realtor.com leads pay a percentage of their commission to Realtor.com if they successfully close the deal - something between 20 - 40%. 

I suppose that’s a better set up than Zillow but I couldn’t imagine giving possibly 40% of my hard work to a software

[Jay Hinrichs]

Quote from @Don Konipol:

Quote from @Ryan Cleary:

I was contacted by a Zillow sales rep about becoming a premier agent. I know the reputation Zillow leads have, but I was curious to have a conversation. I could not believe what he told me...

For 5 leads a month in my market, the price is $4,500... I could not believe that. Even the best agent has a slim chance of converting even one of these leads to a paycheck. I suppose there is a reason agents are doing it but I cannot see this as a profitable endeavor...

I believe that Realtors who sign with Realtor.com leads pay a percentage of their commission to Realtor.com if they successfully close the deal - something between 20 - 40%. 

I wonder if Realtor dot com is licensed then in all 50 states.. so they can legally take a slice of the commish ?

[Ryan Cleary]

Quote from @Jay Hinrichs:

Quote from @Don Konipol:

Quote from @Ryan Cleary:

I was contacted by a Zillow sales rep about becoming a premier agent. I know the reputation Zillow leads have, but I was curious to have a conversation. I could not believe what he told me...

For 5 leads a month in my market, the price is $4,500... I could not believe that. Even the best agent has a slim chance of converting even one of these leads to a paycheck. I suppose there is a reason agents are doing it but I cannot see this as a profitable endeavor...

I believe that Realtors who sign with Realtor.com leads pay a percentage of their commission to Realtor.com if they successfully close the deal - something between 20 - 40%. 

I wonder if Realtor dot com is licensed then in all 50 states.. so they can legally take a slice of the commish ?

 Interesting thought!

[Lorenna Sparling]

Getting started out in a HCLM, so...not interested in buying leads at all.  Thanks for the heads up.

[Matthew Paul]

I was on the other end with Zillow . I put my house up for sale FSBO . And low and behold the first day it went live on the website , I was getting 6 or 7 calls per HOUR . All from agents , they were blowing up my phone . ( All were reading from the same script using all the same sales buzz words ) . All in all it was over 85 different agents .

Think who is making the money , and it isnt the agent . 

[Don Konipol]

I think that if you’re in a real estate service business for the long run and want sustainability of your business you’ve got to develop a source of funneling your own leads and not rely on purchasing leads.  There are on line marketing experts out there specializing in real estate that could create an ongoing program making an agent well known in their market and getting lots of quality leads.  Takes an investment of $50k + depending on market.  Then you’ve got to get referrals and more referrals from sources developed.  And create a team to handle the stuff you don’t have time for.  You know, operate it like a business.  

[Jay Hinrichs]

Quote from @Don Konipol:

I think that if you’re in a real estate service business for the long run and want sustainability of your business you’ve got to develop a source of funneling your own leads and not rely on purchasing leads.  There are on line marketing experts out there specializing in real estate that could create an ongoing program making an agent well known in their market and getting lots of quality leads.  Takes an investment of $50k + depending on market.  Then you’ve got to get referrals and more referrals from sources developed.  And create a team to handle the stuff you don’t have time for.  You know, operate it like a business.  

referrals are the lifeblood of any really good resi agent.. My Wife has 35 years at this and 100% of her bizz comes from referrals she has not paid to market in a very very long time.

[Yogev Lifchin]

These numbers are not fun at all to say the least.
I would recommend to consider setting up your own marketing methods.
Could be cold calls, direct mail or PPC
If PPC interests you I wrote a few articles about it here