This week on Industry Relations, Rob and Greg go head to head on MLS data. They debate whether the MLS industry will die with Zillow when Rob’s proverbial asteroid hits. Greg disagrees and wants to see a future between MLS and CoStar.
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Zillow Adds Down Payment Assistance Information to For Sale Listings
“Millions of people may be more qualified to buy a home than they realize, and partnering with Zillow is a great opportunity to help guide these individuals from dreaming to reality,” said Rob Chrane, CEO and founder of Down Payment Resource. “We’ve worked for many years to curate the most expansive list of affordable homeownership resources available. Nearly every community is served by some type of assistance program, and it’s our mission to get this information into the hands of those that need it.”
I had a chance to talk with Rob Chrane on my Listing Bits podcast about his journey with DPR (Down Payment Resource). It’s a great story to hear how Rob has manifested his vision to bringing this kind of data to help more families purchase homes.
So inspirational when you can match social good with such a great entrepreneurial spirt. Well done Rob, congrats to your team and Zillow.
All good things must come to an end.
Katie joined W+R Studios back in January of 2013 and quickly became indispensable to me. She was a fast learner and began to take over different parts of the business. She got my sense of humor, told me when I was wrong (many times), and did many parts of the job better than I did. And to see her become a mother earlier this year filled me with more joy than I thought possible.
I’m extremely proud of what she has accomplished at W+R and the industry, where she has been part of the RESO Board of Directors and the CMLS Board of Directors along with getting CMLX1 certified. While it’s hard for me to imagine not working with her every week, I am excited to see her continue to grow on this next adventure…..ish.
Thank you Katie. #shakeandbake
Zillow Quits Home-Flipping Business, Cites Inability to Forecast Prices
“But Chief Executive Rich Barton said Tuesday that Zillow had failed to accurately predict the pace of home-price appreciation, marking an end to a venture the company once said could generate $20 billion a year.”
The irony is so thick here you could cut it with a knife.
Lots of chatter about Andy Florance’s interview with Brad Inman last week at Inman Connect. Andy has certainly gotten better at his storytelling since his last interview with Brad. According to Mr. Florance Zillow is “hijacking” listings by placing other agents around the listing. But what Mr. Florance fails to mention is that any broker or agent that has an IDX website is also “hijacking” listings.
What’s at stake here is at the very core of the principles behind the MLS, “cooperation and compensation”. Basically, you help me sell my listing, I’ll help you sell yours.
In a perfect “CoStar world” cooperative compensation goes away, and agents must directly pay to advertise listings. “The Australian model”, some have dubbed it. In this case, CoStar’s acquisition of Homes.com serves as their listing portal and Homesnap for their agent toolbox. Sidenote: I find it kind of funny that Mr. Florance has beaten Rupert Murdoch and his News Corp to the “Australian model” of real estate. Since realtor.com is so very entrenched in Opcity’s broker referral model.
Now, this is a completely sound business strategy. Break up the MLS-Broker model and go directly to agents and consumers. CoStar, Homes.com, and Homesnap have made a bet, in my opinion against the MLS. Okay, you do you.
But, I personally don’t agree with this solution. I think having a strong MLS, makes the market work. And I think as we evolve policy in regard to transparency in commissions and listing attribution we can make things better for everyone.
And let’s be honest. The Seller doesn’t give a shit about any of this. They just want their house sold. Zillow and other IDX sites do a great job of giving listings the greatest exposure in the market. All the broker needs to do is, put it on the MLS.
I also don’t agree with the fear-based message Mr. Florance is sending out. It seems that Mr. Florance’s whole value proposition is that they are “not Zillow”. Zillow is the “mafia”. Zillow is “hijacking” your listings. He even readily admits that CoStar is not coming out with any innovations in regard to the “UI or UX” of its software. It seems their entire go-to-market strategy is just tapping into all the Zillow haters. Granted, Zillow has done a lot of stupid things to make it easy to pick on them but I wish Mr. Florance would tell us why his site and tools are better than everyone else’s instead of just bashing competitors.
Next week CoStar/Homes.com/Homesnap is shutting down part of the Gaslight District in San Diego and throwing a huge party and concert with Country Music Star, Keith Urban. And I’m sure a lot of wining and dining will happen.
But, I’m not a big fan of Country Music, especially Australian Country Music.
“But many suggested there were other motives at play, such as a faulty algorithm for home purchasing, as other iBuyers like Opendoor continue to buy homes amid the same labor shortages and market.”
Wait? You’re telling me the Zestimate is inaccurate??
Zillow has been consumer-centric since its inception in 2006. And in the early days, the tech company didn’t pay much attention to agents. Now Zillow realizes that reducing friction for consumers means helping agents respond to online leads and schedule showings, for example. But is it too late to earn the industry’s trust?
Errol Samuelson is the Chief Industry Development Officer at Zillow Group. With 25 years of experience in proptech, he served in leadership roles at Realtor.com, Top Producer Systems, and Move, Inc. before joining Zillow in 2014. On this episode of Industry Relations, Errol sits down with Rob and Greg to explain why Zillow is acquiring ShowingTime and explore what’s behind the industry’s volatile reaction to the announcement.
Errol discusses the real estate industry’s distrust of Zillow, acknowledging the frustration the tech company has caused over the years and assuring us that his team will not misuse ShowingTime data. Listen in to understand how Errol thinks about CoStar as a competitor and learn why he believes an industry without cooperation and compensation is not good for agents, brokers or consumers.
What’s Discussed:
Why the real estate industry went apeshit over Zillow’s acquisition of ShowingTime
Zillow’s assurance that ShowingTime will remain an open platform with a strict privacy policy
What problem Zillow is trying to solve by acquiring ShowingTime
Errol’s insight on the rumor that Zillow bought ShowingTime to keep it out of CoStar’s hands
How Errol thinks about the fact that people assume Zillow is lying
Errol’s acknowledgement of the frustrations Zillow has caused agents over the years and how the company’s behavior may have amplified the industry’s distrust
The possibility that social class and age are a factor in the industry’s mistrust of Zillow
The focus of Zillow’s Q4 earnings call (Zillow Offers vs. streamlining the consumer experience overall)
Why innovation in the lending space is limited by federal regulations
The unique opportunity Zillow has to innovate around ownership models
Errol’s thoughts on CoStar as a competitor and why CoStar’s success hinges on the government putting an end to cooperation and compensation
Connect with Errol:
Connect with Rob and Greg:
Resources:
Rob’s Post on Zillow, ShowingTime & Paranoid Realtors
Zillow’s Press Release on Acquiring ShowingTime
Zillow’s Q4 2020 Earnings Call
Gary Keller’s 2021 Family Reunion Vision Speech Recap
Rob’s 2020 List of the Seven Most Interesting People in Real Estate
Federal Regulations on Mortgage Finance
CoStar’s Q4 2020 Earnings Call
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As the real estate industry has evolved, we’ve been trained to focus on who owns the data. And Zillow’s acquisition of ShowingTime has many concerned about sharing their data with the proptech giant. But what if hoarding your data is not the only way to compete with a company like Zillow? What if it’s not really about access to the data but what you do with it?
Nick Bailey is the Chief Customer Officer at RE/MAX. With nearly 25 years of industry experience, Nick served as an agent, broker and proptech vendor before becoming the head of a major real estate franchise. On this episode of Industry Relations, Nick joins Rob and Greg to share his take on Zillow’s acquisition of ShowingTime and what’s behind the industry’s emotionally-charged reaction.
Nick offers insight on how the data Zillow acquired was already publicly available, explaining why that information doesn’t necessarily give the tech company a competitive advantage and reminding us that it’s not unusual for companies at scale to offer various products and services to the industry at large. Listen in for Nick’s perspective on what we can do to improve the process of buying or selling a home for consumers and find out why you shouldn’t panic about Zillow’s acquisition of ShowingTime.
What’s Discussed:
Nick’s background as an agent, broker, tech vendor and head of a major real estate franchise
Why Nick sees Zillow’s acquisition of ShowingTime as one tech company acquiring another to make the process of buying and selling homes easier for consumers
How ShowingTime’s market share influenced the industry’s emotionally-charged reaction to its acquisition
Nick’s argument that the data Zillow has acquired was already publicly available
How Nick addresses the objection that the ShowingTime acquisition forces agents and brokers to provide Zillow with a competitive advantage
How it’s not unusual for companies at scale to offer various products and services (e.g.: RE/MAX’s acquisition of Motto Mortgage)
What Nick is doing to educate agents around the spirit of cooperation in the industry
How Nick thinks about whether Zillow is a RE/MAX competitor
What the real estate industry can do to improve the fragmented process of buying or selling a home
Nick’s insight on what differentiates RE/MAX in competitive industry that includes a growing number of iBuyers
The trend toward a greater concentration of power among fewer agents and how that might contribute to the panic around Zillow
Nick’s advice for MLS, franchisor and large brokerage CEOs on using data to identify trends and create contingency plans accordingly
Connect with Nick:
Connect with Rob and Greg:
Resources:
ShowingTime’s Press Release on Its Acquisition by Zillow
Nick’s Video on Zillow’s Acquisition of ShowingTime
Rob’s Post on Zillow, ShowingTime & Paranoid Realtors
Brad Inman’s Piece on Zillow & ShowingTime
Gary Keller’s 2021 Family Reunion Vision Speech Recap
Our Sponsors:
I was talking with a tall and smart MLS exec (he made me write that) about the negative response from agents and brokers about Zillow buying ShowingTime, and why it’s not going away anytime soon. He said, that the underlining issue is not about the privacy of data, but more related to Zillow now being a broker in nearly every MLS market in the country.
“Greg, what agents and brokers are really pissed off about is their money contributing to the bottom line of a competitor. Their MLS, which they pay dues to, is now pro-actively funding another broker’s business.”
Now, you could argue if Zillow is really competing with the average agent, but when you shift to “Zillow is now a broker”, it cuts both ways.
