The Buyer’s Market is Real (and Zillow is the Worst)

Show Notes

This week Dan and I did something we'd never done before — we brought a guest on. Lindsay Howard is a real estate broker (newly minted, as of this February) who runs Howard Home Realty with her mother Cathy, and she walked us through what entrepreneurial real estate actually looks like from the inside. The short version: it's a small business wearing a big-industry costume. Even if you hang your license under a nationally known shingle, you're still just one person running a sales process, laying groundwork that might not pay off for four years, and killing what you eat. Lindsay was refreshingly honest that her first go at real estate, back around 2010 in the post-crash wreckage, was miserable — she sold one house, rented one house, and went back to bartending. The difference the second time was working alongside someone who already had the foothold.

The meatiest stretch was Lindsay untangling the new NAR rules that landed last fall, and honestly Dan and I both came in only half-understanding them. Here's what I took away: after the big commission class-action settlement, a buyer's agent now has to have a signed buyer's rep agreement before they can show a property, the seller is no longer automatically on the hook for the buyer's agent's commission, and you can't even type the word "commission" on the MLS anymore. Lindsay's pet peeve out of all this is agents now cold-calling each other to ask "are you offering commission?" — which she finds gross, and her workaround is just to write it straight into the offer. "Give me my commission, this is part of the offer." No phone call required. She also confirmed the thing I'd half-suspected: all that hullabaloo to protect the consumer produced almost no visible change for the consumer.

And then there's Zillow. Lindsay said it loud and clear, twice — she hates Zillow. The complaint is specific and it tracks: Zillow is an aggregator that scrapes listings straight off the MLS and then doesn't keep them current, so when she drops a price, Zillow keeps showing the old higher number until it gets around to refreshing. Worse, she explained the bit I genuinely didn't know — agents pay Zillow to appear on listings that aren't even theirs, so a buyer thinks they're calling the listing agent and they're really calling someone who bought the placement. Her recommendation: use homes.com or realtor.com instead. The funny irony Dan caught is that the one legitimately useful thing an aggregator does — letting you search every regional MLS in one place — is about to be solved natively, since Texas is merging HAR, Austin, Dallas, San Antonio, and College Station into a single statewide MLS.

The line that gives the episode its title is Lindsay's flat verdict on the current state of things: it's absolutely a buyer's market right now, and don't let anyone tell you otherwise. The logic is the classic seesaw — when rates are high, buyers have leverage; when rates are low, inventory gets snatched up. Her own builder inventory sat quiet from January until a few weeks ago, which she pinned on tax season plus a jittery political and stock-market mood. But she pushed back hard on the rate panic, and I loved this: 6% only feels brutal because we anchored to the sub-3% world of 2020. Back in the mid-90s a 6% rate was a good deal, and Cathy started in the 80s when rates ran 12 to 15 percent and the MLS was a physical book you punched holes in. So if you're shopping right now, you can probably find what you want and negotiate the price down — there's an agent in the Houston area we can refer you to.

We closed on the builder mechanics, which I found genuinely useful: rate buydowns. A 3-2-1 buys the rate down by a couple points the first year, one point the second, then it settles back to the real note rate — a structured bet on where you'll be in three years. I told Lindsay that's exactly what Toll Brothers is doing near me. It's a smart tool for a builder who'd rather buy down the rate than drop the headline price, because it keeps the asset's transaction price high. Dan and I have always told you that getting started in anything is more money out than money in — and an agent's first year, where you make basically nothing and need a second job or a patient partner, is just that lesson in real estate clothes.

The rules changed, the headlines screamed, and somehow the consumer barely noticed — but if you know where to look, the deal is still out there. Just don't look on Zillow.

— Sean