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Explaining the controversy surrounding

There is a medium-sized kerfuffle in the real estate industry that is raising eyebrows. We opine below as to whether or not it is worthy of all this fuss.

Hubub about’s re-launch

It’s been described as a market-disrupting “hail-mary” pass that will change the entire real estate industry and the beginning of “crazy town.” I, however, believe that Bruce Lemiux’s thoughts about Market Leader re-launching the domain with data from the associated brokerages licenses it also acquired last year from Lending Tree were most accurate when he said, “Yawn.”

It’s an 8.25 million dollar example of the larger industry debate about data sharing and how business models for online success in real estate will integrate with (or bypass) real estate agents – “bricks and mortar” if you will. And quite frankly, as has been noted elsewhere, if the website as it stands today represents the “re-launch” that was touted in the company’s buzzword-compliant and SEO-optimized press release, then they just spent a lot of money to very publicly embarrass themselves.

A quick illustration:

As I’ve written about before, I don’t believe that the raw data provides the same amount of value as the local, friendly individual that puts that data into context, and can dynamically filter and adjust it based on something as slight as a client’s non-verbal cues. To make this less personal, let me take an example from my car that might put this all in perspective.

I drive a reasonably-recent hybrid car brimming and whirring with electronics. There are a bunch of computers processing raw information to coordinate the electric motors, battery charging, and gasoline engine status while ensuring my safety through a coordination of a bunch more things like the airbags and brakes. If my car alerted me every time something happened with one of these systems, I would quickly become so overloaded with information that I would promptly park the vehicle and walk away.

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But last week my vehicle’s dashboard illuminated the check engine light with a message about my hybrid system. My car was programmed with a philosophy that sometimes less is more and that it should alert me only when it has meaningful and actionable information. In this case I took my car to the repair shop and it was repaired under warranty.

I appreciate that my car spares me the reams of raw performance data and only alerts me when necessary. I do not want information unless it is personally meaningful to me and actionable in my particular situation – and I believe real estate shoppers feel the same way. Knowing a house is for sale is a commodity.

Long before Z/T/R

Long before Zillow, Trulia, or Redfin came along the chatty neighbor would also tell you that for free. Knowing that a house is for sale that fits their bedroom count and can be purchased with their particular financing requirements is more valuable and actionable.

Knowing that a great house is for sale that fits their bedroom count but they should ignore it because of something particular to their search moves even farther up the value chain. Finding a way to successfully overcome, fix, or work-around that one (or three) things that stands between a potential buyer and the house they want notches the value up dramatically.

The Siri era is here

We live in the age of Siri – decades of research and billions of dollars spent have finally delivered a phone that can tell me the weather when I ask conversationally. Someday someone will successfully build an algorithm and launch a business model that takes the raw data of real estate and transform it into meaningful and actionable information that makes sense to consumers in the way they want at the moment they need it (if your Realtor doesn’t promplty return your phone calls, texts, and emails you should fire them, but that’s another story).

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Given how long it has taken the technology and telecom industries to build a phone that can answer a simple question about the weather, I feel secure that agents like myself will have an important role to play in the real estate value chain for a very long time.

Zillow, Trulia and other real estate “innovators” aren’t real estate companies that derive their income directly from the purchase and sale of a particular house but are instead advertising companies that derive income when individual agents voluntarily agree to pay them money so they can appear prominently on a page that most likely features someone else’s listing. Zillow, Trulia and similar websites and brands have spent years redesigning and subtly improving their product so that they can sell more advertising and generate more income in their core business – which is selling advertising.

Quite frankly, the website looks to me like it was slapped up by a collegiate insomniac who spent $99 dollars for some clipart and $99 for a wordpress theme and pulled an all-nighter to put together a rather sophomoric effort. If this took them a year to design and code, I’d like to know what they did with the other 364 days?

Zillow and Trulia are recognized brands at this point, regardless of your feelings about syndication, IDX, or data sharing. I’d be willing to make a friendly bet that when Lending Tree wanted to dump their domain and brokerage licenses, they got in touch with every player in the market. It wouldn’t surprise me to learn that Zillow, Trulia, and others passed on the opportunity to spend so much on a domain name because they’ve built enough name recognition that they don’t need the “obvious” domain name to redirect to their own site. NAR would have made a perfect buyer for the domain, but that’s its own column…

Getting to the crux of the controversy

The part of all of this that is fascinating – and probably “smells” the most offensive – is how a company with a valuable domain name and brokerage licenses that once was in the business of earning income on the purchase and sale of individual homes has suddenly transformed into something else entirely: an advertising company with a lot of brokerage licenses that provide it with IDX data feeds so it doesn’t have to rely upon syndication for the data it needs (real estate listings) to sell its new product – contact data for consumers browsing on their very expensive URL.

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To me this just smells like bare-knuckle American capitalism at work. We live in a country where Google (the website folks) can buy Motorola (the old-school hardware company) while Apple and Samsung are busy litigating each other senseless. We could wake up tomorrow to headlines of Apple buying AT&T or Wells Fargo buying PayPal from eBay. After all, a coffee company just made a major play in the retail payment processing space (Starbucks and Square). Anyone can buy their way into another industry – but buying your way in the door is entirely different from succeeding once you are there.

Bloggers’ support and criticism of the move:

Written By

Matt Fuller brings decades of experience and industry leadership as co-founder of San Francisco real estate brokerage Jackson Fuller Real Estate. Matt is a Past President of the San Francisco Association of Realtors. He currently serves as a Director for the California Association of Realtors. He currently co-hosts the San Francisco real estate podcast Escrow Out Loud. A recognized SF real estate expert, Matt has made numerous media appearances and published in a variety of media outlets. He’s a father, husband, dog-lover, and crazy exercise enthusiast. When he’s not at work you’re likely to find him at the gym or with his family.



  1. J Philip Faranda

    August 14, 2012 at 7:55 pm

    While I tend to feel that it is a mistake to underestimate your adversary, I think Matt here is probably right for a variety of reasons.
    In my experience, the best way to be profitable in real estate brokerage is to list and sell lots of homes. I have yet to see this uber-IDX business model be organically profitable on its own.  Millions in venture capital makes a splash, but does not equate to sustainable long term profitability. . 

  2. J Philip Faranda

    August 14, 2012 at 7:56 pm

    While I tend to feel that it is a mistake to underestimate your adversary, I think Matt here is probably right for a variety of reasons.
    In my experience, the best way to be profitable in real estate brokerage is to list and sell lots of homes. I have yet to see this uber-IDX business model be organically profitable on its own.  Millions in venture capital makes a splash, but does not equate to sustainable long term profitability.

    • MattFullerGRI

      August 14, 2012 at 9:57 pm

       @J Philip Faranda I think “ogranically profitable” goes to the heart of this debate about various business models. Venture capital or other external funding can be a great starter or source of leverage, but if you can’t pay the bills then the lights eventually have to go out…

  3. StuSiegel

    August 14, 2012 at 8:54 pm

    @gregrobertson How does that explain anything?

  4. JonathanDalton

    August 14, 2012 at 8:57 pm

    Real life lesson – I get a ton of IDX rental leads. Clients that come through on the IDX, because they are shopping homes and not agents, tend to be more than a little flighty. And that’s okay, as long as you know what you get.
’s plan isn’t much different than what I’ve long planned should Arizona ever open a state-wide MLS. I’ll be the most referringest mother you’ve ever seen. Still won’t pay the mortgage on its own, but it’ll give a little bit of a bump.IDX is very, very helpful in obtaining the David Knox prototypical “just be there” transactions. But since it all comes down to being in the right place at the right time, sustainability is tough. A consistent listing base still is the key – the buyers agents can do whatever they want to attract buyers and, honestly, we ought to root for them. Because when they do their job, we get paid. Not a bad set up.(Quick note – please spare me the b.s. totals about the tremendous number of leads you get through IDX, okay? You’re like the guy in Singles who collected 20 numbers of 20 women you’ll never call, never see in the daylight, 20 numbers you got just so you can say you got 20 numbers.) 

    • MattFullerGRI

      August 14, 2012 at 9:52 pm


    • MattFullerGRI

      August 14, 2012 at 9:55 pm

       @JonathanDalton In my experience, the leads I get from a certain unnamed partner program tend to be the most skeptical and hardest to win over, but depending on the complexity of the transaction they can quickly become big fans. I’d very much agree with you that building a business on IDX is all about volume, and definitely a challenge. My experience with IDX leads hasn’t been that they are more flighty, just less serious shoppers overall. Which is perhaps a different way of saying the same thing. You can only sell a house once (unless you want it to cost you more than your commission) so I’ll take 1 solid lead over 50 flaky ones any day of the week…

      • 365frederick

        August 15, 2012 at 11:13 am

         @MattFullerGRI We’ve flitted about from various third party partner programs over the last 20 years, some have paid off for a while, some not at all. The leads from those sites are not the best leads, no doubt. I do think, however that the actions of consumers have changed, and the days of the domination of the Trulia’s and Zillow’s are numbered. Melinnials have grown up with search, and are seeking much more in-depth information. Information about neighborhoods, lifestyles and local expertise. These are the specialty of the local agent, not the big national information brokers. Just having massive amounts of listings on your site, although a draw, isn’t enough.

  5. kenbrand

    August 15, 2012 at 1:12 pm

    Human nature views competition as threat.  But is it really?  I guess it is if you don’t have Top Of Mind Awareness as a trustworthy go to pro within your network.  Or you don’t have a network your rule, or people don’t like you, then you have to rely on leads from strangers. If you do rely on leads from strangers than instead of earning trust and choice, you pay for a contact and take your chances.  The challenge is if you don’t rule a network and people apparently don’t trust you, you’re not going to hot-dog your way to the bank chasing strangers because as most research, experience, observation and feedback from actual consumers at events like Hear It Direct all point to the same thing – the vast majority of consumers (me and you) we don’t like to be harassed by strangers.  Strangers chasing strangers who don’t like strangers is a hard road to hoe.  Bottom line, who cares.  Care about the people you know, the people you work, play, socialize with and around.  Make yourself the go to person for everything home, family, community, lifestyle and real estate.  Sure people may shop around the interent to dream and research, when it comes time to buy or sell, most of us would chose  a trusted pro……if we know one.  The question is are we know that way.  My 2 cents.  Back to work now people.  

    • MattFullerGRI

      August 15, 2012 at 2:51 pm

       @kenbrand Ken – I think most agents would agree with you. I guess the question is do you think it will be possible (in the next 5 – 10 years) to replicate the trusted network you describe with an online site along the lines of something in the ZTR model? 

      • kenbrand

        August 15, 2012 at 4:40 pm

         @MattFullerGRI Who knows Matt.  We have to keep our head on a well oiled swivel and minds and imaginations wide open, even when we think some of the satellite schemes are dumb things for dummer people.  It’s not likely that ZTR will replace what it takes to create Top Of Mind Awareness anytime soon, but it does prey on the an army of hopeful soliders who have to buy attention and opportunity, instead of earn it or create themselves. Facebook is an example of a modern tool that when used well helps to create Top Of Mind.  So, who knows.  I sleep with one eye open.  cheers

  6. michaeltudorie

    August 15, 2012 at 6:46 pm

    @RealtyNinja very very informative articles. RT

    • RealtyNinja

      August 15, 2012 at 7:50 pm

      @michaeltudorie thanks michael 🙂

  7. Sean Goerss

    September 11, 2012 at 2:57 pm

    Matt, just read this article after referencing a similar one my tech tuneup I do with agents, great stuff, I’m going to share it!I think we have to be real careful about differentiating a vendor from a competitor.  

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