The Housing Scene by Lew Sichelman

Online Reviews Not Always Trustworthy

Many people rely on online reviews to decide what to buy. Indeed, research from Nielsen Global Media shows that opinions posted online are second only to personal recommendations in influencing purchase decisions.

But how do you know those reviews aren’t bought and paid for by the outfit in question? You don’t, of course.

This fall, the Federal Trade Commission came down hard on two companies for posting false reviews. One was a skin-care company posting tributes written by its own employees, and the other was a (now-defunct) company that sold fake social media followers and subscribers to various entities.

Unscrupulous tactics like these show why homebuyers and sellers should be particularly careful when selecting homebuilders, real estate agents, mortgage brokers and remodelers. For one thing, don’t rely on evaluations posted on the companies’ own websites; you’re certainly not going to find anything negative. But on gripe sites like pissedconsumer.com or ripoffreport.com, you’re not going to find anything positive, either. Frankly, it’s hard to get anything resembling a balanced characterization of any company.

Fortunately, a quick Google search failed to turn up any cases in which builders resorted to the sorts of underhanded tactics flagged by the FTC. But the story’s not the same when it comes to agents.

One agent reported that she was contacted by a colleague, offering to write a glowing review if she would do the same for her. In another case, a Kansas City agent who was given a poor grade on a website (that has since been taken down) was told she could pay $5,000 to have it removed. She said it was nothing more than a “shakedown.”

Some agents have been called to task for penning their own positive testimonials, and in a few cases, poor reviews were posted by competitors just trying to make another agent look bad.

For the most part, though, fake reviews are put up by disgruntled consumers who, rightly or wrongly, feel they’ve been abused in the process of building, buying or selling a house.

Still, good or bad, “it’s hard to know where (reviews) are coming from,” said Adah Rodriguez, a spokeswoman for the Southern Colorado Better Business Bureau, in an interview with local news channel KOAA this fall. “It’s pretty safe to say, through any platform, probably at least 50% of reviews are fake.”

In the housing sector, the major real estate listing sites such as Zillow, Facebook, Yelp and Google all have rules against posting false testimonials, and those who violate them can be banned.

Recently, guaranteed honest reviews by real buyers of new construction have been added to the NewHomeSource website, a top site where builders post their communities and listings. (Full disclosure: I occasionally provide content for the site.)

To date, roughly 27% of the 14,000 communities listed at NewHomeSource have signed on to take part in the review program, called TrustBuilder. The list includes several national builders, including KB Homes, Beazer, Centex, Dell Webb, Lennar and Pulte, according to Jay McKenzie of Builders Digital Experience, the Texas company that operates the site.

In the TrustBuilder program, every person who purchases a house from a participating builder is asked to provide a review -- good, bad or otherwise. Of course, not all buyers will do so. Typically, companies only hear from people who are very happy or very unhappy; the rest don’t bother. But no reviews will be posted until there are at least 10, so future buyers can get “a more complete and balanced picture,” McKenzie says. “A true representation.”

No reviews will be changed. “This is all independent of the builders,” says McKenzie. “Reviews will not be censored. We don’t hide, edit or delete them. They are independent, transparent and credible.”

At the same time, though, builders will be given an opportunity to try to fix any issues raised in negative posts, and aggrieved customers will have the option to alter their opinions later if they so desire. “Problems will occur, so this is a good outcome for everyone,” McKenzie explains.

Tyson Kirksey of Highland Homes in Texas says the value of honest customer reviews cannot be overestimated. “We’ve seen many sites struggle with the problem of fake reviews. A program like TrustBuilder is long overdue,” he says. “We’re excited to participate.”

So is Allan Merrill of Beazer Homes. “By providing access to ratings and reviews from known new homeowners,” he says, “TrustBuilder should become an integral part of the new-home shopping process.”

Meanwhile, whether you are shopping for a house, builder, realty agent or lender, it’s always wise to be somewhat skeptical when it comes to online reviews. The FTC suggests also checking other sources -- the Better Business Bureau, for example, or another impartial expert organization.

Don’t consider just one or two reviews, either. Look at as many as you can to see if you can discern a pattern. And while you’re at it, search the name of the builder or agent followed by the word “complaint” to see what kind of negative experiences people have had.