We can all agree that the real estate industry is evolving quickly. Is there any way to predict who the winners in the space will be over the next few years? Brad Safalow has done nine years of research surveying hundreds of real estate agents on the housing market in general, online lead generation, marketing and technology. Curious what all that data might tell us about the future of industry players like Zillow, Redfin and Realogy? What about the potential market share of the growing iBuyer model? Or how independent brokerages might respond to the competition?
Brad is the founder of Please Act Accordingly Research, an independent research firm providing investment ideas to professional money managers and high-net-worth individuals. He began his career in the leveraged finance group at JPMorgan before joining RiverEdge Capital, a global equity hedge fund, where he specialized in small/mid cap stocks and short idea generation. Brad has been serving clients through PAA since 2009, generating 6+ action-oriented investment ideas annually, with high absolute return potential.
Today, Brad joins Rob and Greg to share a high-level overview of his report on the real estate industry. Brad shares his take on the challenges Zillow is facing with the backlash against Premier Agent 4 and its foray into the iBuyer market. Rob highlights the concentration of power in real estate and its influence on Zillow’s continued success, and Greg asks about the pros and cons of the iBuyer model and its potential share of the marketplace moving forward. Brad also shares his experience working with Redfin versus a traditional brokerage, and they offer insight around how Redfin’s national ad campaign might prove to be a seminal moment in the industry. Listen in to understand how independent brokerages like Keller Williams and Realogy are responding to the iBuyer threat and a potential shift in commission structure—and get Brad, Rob and Greg’s predictions around the winners and losers in the space over the next three years.
What’s Discussed:
The PAA annual survey of real estate agents
A high-level overview of Brad’s report
The reasons why Zillow’s stock is taking a hit
How Zillow’s growth depends on agent teams
Why Zillow launched Premier Agent 4
How Zillow responded to backlash against PA4
The concentration of power in the industry
Why Zillow is pursuing the iBuyer model
The iBuyer’s potential share of the market
How Zillow may profit as a mortgage business
Efforts to improve the consumer experience
Redfin vs. the traditional brokerage experience
The impact of Redfin’s national ad campaign
The effects a shift in commission structure
The fear/panic among independent brokerages
Gary Keller’s understanding of the iBuyer threat
Realogy’s doubling down on traditional strategy
Resources:
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