Where Real Estate Gets Its Dirt

CoStar completes the purchase of Homes.com and goes back to the future

Company plans to combine Homes.com and Homesnap to offer the best online home buying experience possible by frictionlessly connecting agents, buyers, and sellers

“Rather than building a business model based on creating friction to syphon off agent commissions, we plan to provide a next generation marketplace that connects listing and buyer agents to sellers and buyers without taking a cut of their commissions.” – Andy Florance, CEO of CoStar Group

Mr. Florance is a master at fear-based marketing. But I see three big problems with this strategy. The first problem is that early results show that many consumers like the one-stop and iBuying experience. The second is total available market (TAM). We all know of the 80/20 rule. In real estate it might be 90/10. If you are only going to sell to agents with listings then you are severely limiting your market. The third problem they have? Zillow.

“Homesnap is the leading real estate productivity and marketing app and hundreds of thousands of the most productive real estate agents in the country rely on it to manage their businesses. CoStar Group intends to fully integrate Homesnap and Homes.com, with Homesnap at one end as the agent’s professional tool and Homes.com on the other side as the home buyer’s portal. Once integrated, agents will have instant access to manage their listings on Homes.com, view and respond to inquiries, collaborate with clients, and provision and monitor sophisticated digital marketing campaigns. We believe this direct connection between agents and a consumer portal is unique in the industry.”

Isn’t this exactly Homesnap’s existing business model? Collaborate! Your listing your lead! Automate your social media marketing!

“Homes.com has one of the largest real estate portal sales forces and CoStar Group intends to leverage that sales force to sell the Homesnap product with the goal of expanding Homesnap’s reach to hundreds of thousands of additional real estate agents.”

Oh, I guess they didn’t have a big enough sales force to properly monetize this strategy. Release the hounds!

Also, no mention of the Broker Public Portal.

I hope there is more to this than what I’m reading. I was really excited to hear something innovative coming from these guys. All I see is a company stoking fear and increasing their sales staff.

  1. The only possibility I can see might be to perfect the listing alert system and buyer-to-buyer-agent communication process. But HomeSnap doesn’t even have a valid listing alert product. This “pick your three favorite zip codes” thing is trash and so is the “news feed”.

    No one has perfected push notifications to the phone or app yet – everyone still uses email. Perhaps emails that cause you to open links in the app where you can then communicate directly with your buyer’s agent?

    If they could make the experience a little more like RealScout, perhaps they could monetize that? As of now, buyers tend to grab Redfin/Zillow links and text them to the buyer’s agent. I don’t know about you but SMS is out of sight, out of mind for me. Of course, I read it initially, but if I’m busy, I’ll completely forget about it. Apple needs a text reminder feature so I can be promted to follow up on old texts.

  2. @stephanie Agree with you on listing alerts. And Homes.com only sends them out once per day. Shameless plug alert: Have you checked out Cloud Streams (https://cloudagentsuite.com/tools/streams)? You can set it up to email or text your clients as soon as homes come to the market. It’s not available in all areas but worth looking in to. Plus I believe CoreLogic is also looking in to providing text alerts in their MLS solution, Matrix.

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