Investors greeted HomeSeekers' (NASDAQ:HMSK) improved revenues with indifference. Even the announcement of a business plan with eBay failed to move the ticker. It's a tough show-me market, but not nearly as tough as the market Homeseekers faces with Realtors when it rolls out its new pay-to-post listings program on eBay.

For the first time since the early 90s, Homeseekers is asking Realtors to pay to post their listings, $50 upfront and $150 when the home sells. The deal gives eBay more listings in an environment where it already requires consumers to pay, and it gives Homeseekers cachet with its agent customers who may want to cash in on a new big-name portal with lots of traffic. Special six-month block ads allow brokers to advertise their brokerages in their own regions, yet another signpost in the trend toward local Internet marketing. It is these ads that will no doubt pay the freight, as the advertisers can then turn around and sell the spots to feature offices, agents, or whatever they want.

If paid listings failed as a business model ten years ago, why would it be any more successful now? If any company should know the risks, it's Homeseekers.

Homeseekers was one of the first companies in the nation to put listings on the Internet and to create a revenue model based on charging for them. But they, Cyberhomes and others (RIN) quickly abandoned the idea of getting listings that way. There simply weren't enough online agents or listings to drive consumers. All the listings sites went to MLSs to get the listings instead, and ended up paying millions of dollars a year for them. One site, Realtor.com, gained tremendous market advantage by creating "Gold Alliance" agreements in which they paid MLS organizations and brokers for exclusive rights to publish public listings. While this drove more consumers to the site because of its large numbers of listings, agents found that the lead generation tools such as school reports and virtual tours that they purchased were considerably higher priced on Realtor.com than other sites where similar tools were free to consumers or lower cost for Realtors as sponsors of the tools. Realtor.com set the "going rate," and bargain listings, with the exception of HomeAdvisor were a thing of the past.

But things change. Agents have been able to put their listings on the Internet free for years, but they finally realized that free listings on the Internet aren't free at all. In order to capitalize on the Internet, most agents were forced to make substantial investments in lead generation tools such as e-mail programs, Web sites, productivity software, newsletters, and other tools to capture the information hungry, Realtor-phobic Internet buyer.

Because things change, and it might very well be in agents' best interests to change their thinking about free listings and the Internet, too.

"The power of eBay as part of an online strategy to win listings and serve customers is to sell more homes in less time and for less cost and effort, " says Richard Rock, the executive in charge of eBay real estate.

The most important change is that buyers are using the Internet - before contacting a Realtor, so the Realtor is no longer the first point of contact. Less than a decade ago, when only a fraction of consumers had home Internet access, they spent more time trying to log on than actually surfing the Net. Agents weren't compelled to pay money to expose their listings where buyers weren't present. Today, over 50 percent of buyers use the Internet to shop for homes and get home buying information, says Jupiter Research. Plus they are using the boss' T1 and DSL line to access listings quickly. If Realtors want to be found by buyers, there's no better bait than listings, particularly listings enhanced with photos, virtual tours, and other information. To capture these buyers, Realtors have to expose themselves where buyers congregate - on listings sites.

Buyers visit more than one site, and each site has its own agenda, strengths and weaknesses, including how much information to give to buyers. A buyer might visit Homestore to look at homes, but may use the property evaluation tools and loan calculator at Homeadvisor. Homeseekers, while it has some information tools, has consistently suffered in polls and comparisons to Homestore and Homeadvisor because the company's philosophy is to let Realtors supply the data. That way they have a better chance of capturing leads because they become the information supplier, not the site.

But Homeseekers' self-sacrificing business model has not been appreciated by some agents, who believe that any provider other than Realtor.com doesn't have their best interests at heart. Others believe that Homeseekers is the best deal in lead generation tools. With a Homeseekers Web site, agents have a personal domain name which can also be put into search engines for local searches by buyers, and they look very snappy on a business card. The company has killer lead alert tools, such as an automated phone dialer that alerts agents via pager or cell phone when they have an e-mail inquiry on a listing or from their Web sites.

By partnering with eBay, the Homeseekers plan gives agents an attractive advertising alternative to what is quickly becoming a small arena of advertising vehicles. For example, there's Homestore which has grown so large that some agents are complaining that when they pay for lead generation, there are still too many other ways that leads can be redirected off the agent's listing/site. HomeAdvisor, gets many votes as the best online listings site, but it is in a transition mode, moving away from developing loan platform technologies and back into what it does best - customer lead generation services for brokers and agents. So far, Homeadvisor doesn’t sell any products directly to agents. They make their money off advertising. Many agents don't even know that they can submit their listings free to Homeadvisor, and that leads are directed straight back to them.

Homeseekers, depending on which poll you read is always number two or three in ranking. While its stock has taken a beating this year, Homeseekers has reported double earnings over the same period last year, showing that its subscription model is working. (If only those Gold Alliance agreements would disappear.) What Homeseekers can offer agents is a point of difference between their offerings and reach and that of other service providers.

Foremost, Homeseekers will be the only place where agents can directly submit listings from their MLS, which some other listings services don't allow, or only with their brokers permission. On eBay, Homeseekers will enable home sellers with home buying tools and platforms where they are most comfortable - the customer to customer model. Homeseekers' April 2001 launch on eBay will start with preferred advertising spots in certain communities. Each spot will be $5,000 and includes links to the broker's or group's site, and it includes showcasing up to 25 listings in each ad. This creates a revenue model for the franchise, group, or brokerage to recoup costs by offering one of the 25 slots to agents to promote their listings.

"We already have larger brokerages competing for these spots," says a spokesperson.

Other opportunities for agents are to submit their listings with a $50 up-front fee, and another $150 when the property sells.

"At any one time there are at least 1 million homes for sale in the U.S.," says John Giaimo, CEO of Homeseekers, "and they turn over about four times a year. The competition for these listings is extremely intense. The eBay exposure will be a significant differentiator and should lead to competitive wins in listings by brokers who are using eBay."

Homeseekers believes that the preferred spots will become important as a human resources attraction to get new employees. If a broker has one of these spots, it will become a selling point to work for that firm.

"eBay will resonate with consumers to a greater degree than any of the current aggregation sites," says Giaimo. "There isn't the recognition in the marketplace, but they all know eBay.

Web site customers of Homeseekers will also receive a discount, promises Giaimo. "We have created a new alternative to help agents expose their listings to the largest possible viewing audience at a very small cost," he says.

Published: February 20, 2001

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Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. For more articles by Blanche, click here.