Where Real Estate Gets Its Dirt

Zillow Has Receipts

Zillow economist calls out Redfin for ‘mischaracterizing’ research

Zillow Chief Economist Mischa Fisher wrote that the analysis is modeled around assumptions, not hard data: “The estimate works roughly like this: take a share of sellers assumed to be uncertain about pricing, multiply by an assumed share who would benefit from early feedback, then apply an assumed relationship between listing confidence and eventual inventory. Stack those fractions, add a ‘multiplier’ for sell-then-buy chains, and you get 6-12%.”

So let me get the timeline straight. In February, Compass signs a three-year deal with Redfin to syndicate its Coming Soon and Private Exclusive listings. Two weeks later (two weeks?) Redfin publishes a study claiming pre-marketing could boost inventory by 6-12%. And some of the data Redfin cited to support this claim? Pulled from Zillow’s own surveys… which Zillow says Redfin “mischaracterized.”

I don’t think Fisher is wrong. The methodology is basically: assume a bunch of things, multiply the assumptions together, tack on a 1.6x multiplier for sell-then-buy chains, and Boom! You get a headline that just happens to validate the business deal your parent company signed last month.

Look, I get it. Every company funds research that makes their strategy look smart. That’s not new. But most companies have the good sense not to borrow their competitor’s homework and then get the answers wrong.

Redfin’s response? “We appreciate the engagement with our research and welcome discussion about the model and its parameters.” Which is corporate speak for “we’re not changing anything, but thanks for reading.”

This whole pre-marketing war has been fascinating (and frustrating) to watch. You’ve got Compass trying to build a parallel listing universe, Redfin handing them a storefront, Rocket greasing the mortgage side, and now they’re publishing research to justify the whole thing while Zillow’s economist is out here doing peer review on LinkedIn! Meanwhile the MLSs are watching their relevance get chipped away one “Coming Soon” at a time.

Fisher also pointed out what should be obvious: pre-marketing creates “information asymmetry” — meaning the buyers who aren’t plugged into Compass’s network don’t get to see these listings. That’s not boosting inventory. That’s just moving it behind a velvet rope, but also what I would expect the incumbent to say.

But who can tell?

35 is the new 40

First-time homebuyers, rejoice!

“There’s just one problem: The death of the thirtysomething homebuyer may have been greatly exaggerated. A new analysis from Redfin, shared exclusively with Business Insider, found that the median age of the first-time buyer last year was 35 — a slight decrease from the year prior. It adds to the growing pile of evidence that the new median of 40 was a mirage. While millennials, now 29 to 45, generally lag behind boomers on the homeownership front, the purchasing milestone hasn’t shifted nearly as much as the NAR report suggests.”

Fascinating reporting by James Rodriguez of Business Insider based on new data from Redfin and other sources. James, to me, is one of the rare writers outside the ORE bubble who seems to really get our business.

There is a bit of quibbling between NAR and other organizations that conduct surveys. But it seems the narrative might need adjusting.

“Because no data source is perfect, what you really want to do is say, What is the bulk of the evidence showing me?” Zhao tells me. “When we compare our results to analyses that other people have done looking at credit bureau data or mortgage data, it seems to support the idea that the age of the first-time buyer has not increased all that much.”

This is important because national policy is being shaped by these narratives getting out. Worth the read.

CoStar strikes back

CoStar Group Reiterates Strategic Initiatives to Prioritize Profitable Growth and Increase Long-term Stockholder Value

“Third Point appears intent on spinning a yarn of Board complacency and “quixotic” investment. Their story is completely detached from reality. Following a review process that Third Point and D.E. Shaw suggested with participation from their Board nominees, the Board unanimously recommended a plan involving accelerated profitability for Homes.com, additional investments in our core platforms, incremental capital return, stockholder-aligned executive compensation, and greater investor transparency. Unhappy with the conclusions of the independent Board they helped pick, Third Point, like a child with a board game, wants to throw the pieces off the board.”

I did some digging based on a tip. What I found was Third Point invested in Rocket last year which changes the optics for me a bit. Could there be a bit of game play here? Maybe. Maybe not. But, as I said in my last post, I still wouldn’t bet against Andy Florance.

But in my last episode of Industry Relations, recorded before the CoStar news broke, I asked Jack Miller his thoughts on CoStar and he had a brilliant take.

 

From Jack’s perspective it’s still about product market fit. In my 2026 predictions I said that we were going to see a shift in the strategies of non-Zillow portals. So far Realtor.com has announced their Realtor + app, and I think Homes.com is going to have to think of something that answers Jack’s take.

Glenn Kelman’s last day

Unemployed, In Greenland

“Running so fast with people so smart made me feel free when I once viewed the business world as a prison. The whole miracle of human ingenuity starts with the simple act of thinking for yourself, but that depends on finding people to whom you can say what you really think. I discovered those people while Redfin was still based out of an apartment, and that grew a thousandfold into our culture.”

Such a class act. Great writer. And one of the last ones who would tell it like it is and cut the corporate gobbledygook.


GFK I’m gonna miss you. Good luck on your new adventures.

Real estate AI search, “actually useful”

I’m obsessed with Redfin’s AI search

“For all the questionable-at-best ways AI is being bolted onto things these days, AI search on a real estate website strikes me as actually useful. I realized that over my many years of searches — both when I was actively looking to buy a home and as a leisure activity — I’ve gotten really good at navigating the likes of Zillow and Redfin. This, I assure you, is a skill that comes with extremely limited benefits, and I probably could have spent that time doing something more useful, like reading a goddamn book, but here I am. With natural language search, you don’t need to spend hours tinkering with filters and keywords like I have; the AI just does all that administrative stuff for you.”

Interesting perspective on AI and Real Estate. Sadly, the article is being the Verge’s paywall.

Zillow accused of “kickbacks”

Zillow accused of using ‘kickbacks’ to boost mortgage business

“Zillow is accused of pressuring agents in its Premier Agent and Flex programs to steer buyers to Zillow Home Loans for pre-approval. Agents who sent more clients to Zillow’s mortgage arm were rewarded with extra or higher-quality leads, while those who didn’t could lose access to the lucrative Flex program, the filing claims.

Buyers, meanwhile, were allegedly steered toward Zillow Home Loans without realizing their agent’s business depended on it. The complaint states that “Zillow’s system harms consumers, who are robbed of the disinterested advice of their fiduciary real estate agent, and instead are unknowingly steered towards ZHL’s limited and often uncompetitive mortgage products.”

Who isn’t suing Zillow now? Seems like something they could easily settle, but what this has me thinking is the implications for the Redfin and Rocket deal? This RESPA shit is pretty tricky.

Red Rocket

Rocket Companies to Acquire Redfin, Accelerating Purchase Mortgage Strategy

“Rocket and Redfin’s approaches to lending and brokerage service have always been two halves of one vision to make the whole home-buying process magical,” said Glenn Kelman, CEO of Redfin. “We want a customer to be able to check her phone to find out what she can afford, see which homes are just right for her, schedule a tour with a local, expert Redfin agent, and get pre-qualified for a loan, all in a matter of minutes. Varun and I see how much better real estate could be when AI guides customers not just through that first step in their search, but all the way home, through the sale, the loan and then a lifetime of accumulating equity and wealth.” 

Talk about attachment rate! But in the end, Redfin had to do something. I remember reading their last announcement about laying off 450 people due to their deal with Zillow Rentals and thinking, “Do they still have 450 left?” There were rumors swirling about Zillow acquiring Redfin, but I never took those too seriously.

I’m still processing what this means for Glenn Kelman—or GFK, as I affectionately refer to him. In an industry dominated by big personalities, Glenn was the guy who was going to fight the good fight. I’m sure the biggest reason this happened was that Glenn saw it as the best path for Redfin’s survival.

The consolidation continues…

Bada Bing

Microsoft Bing Real Estate Portal in Violation of Copyright Infringement – MLSs Must Act Immediately

“It seems like Zillow and Redfin started a relationship with Microsoft to leverage innovative OpenAI technology to deliver some interesting consumer benefits to people searching for homes on Zillow and Redfin. It is hard to ascertain how this relationship started with Bing Chat and evolved into Bing.com/realestate providing a full listing display breaking so many MLS rules, that links out to advertisers, and points to Zillow and Redfin as the sources of the data rather than the brokerage or MLS. It’s not Zillow or Redfin’s data to give!”

Victor Lund, WAV Group

Great write up from Victor regarding the Bing controversy, go read the whole thing. Sam DeBord was the first to start posting about this and Marian at Inman News did a story as well. Good reporting.

Okay so let’s first let’s get something straight right from the top, Bing.com/realestate is a mother fucking real estate portal, not a search results page.

  • I can like properties
  • I can save a property
  • I can setup a saved search
  • I can see multiple photos (sans watermark) – WTF?
  • I can “claim ownership”
  • I can see an “estimated value”
  • I can even get a mortgage!

And it appears that Zillow, Redfin and Realtor.com may be complicit in powering Bing. From Victor’s post,

“Here is how easily Zillow and Redfin can stop bing from accessing and republishing content – code courtesy of OpenAI “<meta name=”robots” content=”noindex”>.” Inventory is turning in 30-90 days in most markets, rendering search on Bing irrelevant in a short period of time. If current listings are not displayed to active home buyers in today’s tight market, consumers will abandon them. Of course, this would be a poison pill for Zillow and Redfin who rely on search engines for a significant amount of their consumer traffic.”

Victor Lund, WAV Group

Shout out to Homes.com for not being a part of this scheme, as Victor also points out.

But MLS organizations need to step up, more from Victor.

“MLS must protect the assets contributed by each broker, or firms will simply contribute their content to OpenAI for free, and access the listing content of other brokerage firms using OpenAI. CMA vendors like Inside Real Estate, Delta Media and dozens of others can stop paying $5 Million a year in Data License fees and access the data from OpenAI. An OpenAi driven CMA would work like Cloud CMAs revolutionary 1 Minute CMA, only it would be almost instant. Moreover, consumers could simply run their own CMA without a professional.”

Victor Lund, WAV Group

“AI” is the new “lion over the hill”. If MLS orgs want to protect their data licensing revenue you need to nip this in the bud now.

Ziltorfin just peed in its pants

“Over $1B invested” 👀

Redfin say it’s “leaving NAR”

Redfin is Leaving NAR

“Redfin is moving to end our support of the National Association of Realtors for two reasons:

  • NAR policies requiring a fee for the buyer’s agent on every listing
  • a pattern of alleged sexual harassment. “
Glenn Kelman, CEO of Redfin

Whoa! The post from GFK also adds this nugget.

“We Want NAR to Decouple MLS Access from NAR Support

We’re asking NAR to decouple local access to these tools, including the listing databases known as Multiple Listing Services, from support for the national lobbying organization. Agents shouldn’t have to underwrite policies and legal efforts that hurt consumers when most of us got into real estate to help consumers. Redfin’s mission after all is to redefine real estate in consumers’ favor. “

Glenn Kelman, CEO of Redfin

There is also story in the New York Times regarding this decision, for those with access check it out too.

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