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.