Three home valuation real estate service providers have simultaneously announced that they're adding real estate listings to their Websites. Two is a coincidence, but three is a bit of an eyebrow-raiser. Has recent news inspired a new race to get agents to supply eye-candy listings to draw more consumer traffic? Are online listings in more places going to be valuable for agents?
HouseValues, HomeGain and Zillow each have different business models, but the outcome for consumers is the same -- they'll get to see real estate listings in a wide assortment of Websites.
But some things won't change, consumers won't see "all the listings" on any single website. In fact, that's looking less and less likely, if the lessons of the listing wars of the late 90s are to be remembered.
That's when Cyberhomes, Realestate.com, Microsoft's HomeAdvisor and others were felled by the superior aggregation prowess of Realtor.com. At the time, Realtor.com was under different management (Homestore) and paid MLSs and leading brokers handsomely for their listings. Many industry leaders participated in Homestore's IPO, enriching themselves with shares after threatening to withhold their listings. Cendant, parent company to Coldwell Banker, ERA, and Century 21, made a killing simply by threatening to sue Homestore, which settled out of court for an undisclosed sum.
But paying brokers, MLSs and franchises as much as four dollars a listing proved to be unsustainable, particularly coupled with paying outrageous sums to AOL and other portals for traffic. Homestore, on the verge of bankruptcy, discontinued the practice.
By 2003, a limping Realtor.com had put its competitors out of business. If agents wanted their listings on the Internet for free, Realtor.com was the place to send them. But Realtor.com's business is work smarter, not harder. Capitalizing on the NAR's relationship with MLSs, Realtor.com was able to receive listing feeds from nearly 900 MLSs.
But things have changed.
Federal interference into the data-sharing policies of the National Association of Realtors and its subsidiary MLSs, as well as broker-owned MLSs, forcing any participant of an MLS to share their listings with online competitors, despite state law allowing brokers to advertise listings where they please, has given a wake-up call to brokers and agents. This has many brokers rethinking the wisdom of allowing their MLSs to become marketers.
Competition has increased. Fidelity has resuscitated Cyberhomes and Realestate.com is owned by a media giant. And Realtor.com is still king of listings aggregation, and may only hold its advantage as the only site where broker listings are found, without being surrounded by for-sale-by-owner listings.
Everyone knows that when 80 percent of housing consumers go to the Internet what they want to see is listings. Because they're still in the what-if stage of investigating home possibilities, they aren't quite ready to meet agents. They want to shop for homes, compare values and narrow down neighborhoods.
But listings are the inventory agents have to sell. Agents want online exposure for their listings because listings serve a dual purpose - they advertise the home and the agent at the same time.
And home valuation-based companies like HouseValues, HomeGain and Zillow need homes to attract eyeballs. So the three online home valuation companies are accommodating agents by posting their listings.
HouseValues is a lead-generation company that targets real estate agents. HouseValues provides leads that agents pay for and pursue, and the company also supplies training, and announced a new subscriber benefit -- free exposure for listings at no extra cost. With just a few clicks, agents can upload their listings to sites such as Google and Oodle, and other "real estate and classifieds sites which will be announced in the coming weeks."
How it works is that HouseValues has a comprehensive desktop lead management tool called Market Leader. It has e-mail marketing campaigns that are programmed to follow up at agent/client's preferred timeframe and it's a database for existing clients and prospects. HouseValues has simply added a new feature -- a listings management tool that uploads listings to HouseValues and its partner sites. The agent tells the tool where to place the listings and on which sites. That said, Google and Oodle aren't bad partners to have.
HomeGain has announced a similar advantage for its agent network. Upload listings for free, and increase visibility for your listing, says the lead generation company. HomeGain was recently purchased by Classified Ventures, an online classifieds site owned by a conglomerate of news organizations. HomeGain's lure is that it will be able to put agent subscriber listings on news services such as The Chicago Tribune.
Zillow is the newest of the home valuation sites, but was founded by Rich Barton, a former HomeAdvisor alumnus (along with Ian Morris, CEO of HouseValues.) The company is moving toward a user-generated content model, and has announced a new property “for sale” feature which will allow any real estate agent to post their listings for free. No subscription required. However, the company also allows homeowners to post their homes for sale, for free, with a “Make Me Move,” tagline designed to allow homebuyers to make offers directly to sellers online.
Agents have put their ads alongside for-sale-by-owner classifieds before, knowing that homesellers won't buy ads week after week if they can't sell their home. But online, where all the listings are free ... what will agents do then? Will they support a site where the founders' clear intent is to build what one news service gushed as the first alternative to the 100-year-old MLS system?
The upshot for agents is that three of the leading home valuation sites have come to the conclusion that they need listings. The question will be -- which services will thrive with the listings and which won't? Having listings failed to save home portals in the 90s -- but new technologies make it possible for agents to sidestep the MLS and the pesky data-sharing rules that the DOJ and FTC is trying to force down MLS members' throats.
What will happen in the oughts?
