HomeLight and AgentMatch offer agent transaction data to consumers
(AGENT/GENIUS) – Launched in 2012, HomeLight is a search engine for agents, or an agent resume, as founder Drew Uhler likes to describe it, offering a unique blend of real estate agent transaction data and consumer reviews, monetized by agent referral fees. Funded to the tune of $1.5 million by Google Ventures, Crosslink Capital, Innovation Endeavors, and unnamed angel investors, it is in the Inman Incubator program, and is to be showcased in the Startup Alley at Inman Connect in New York City in January 2014.
Three weeks ago, Inman News introduced AgentMatch, shaping the conversation by focusing squarely on the negative reactions from agents (AgentMatch is the new site by Realtor.com that provides listing agent transaction data for the last six months in a consumer search site with no referral fees for agents). In seven articles written by Inman News on the topic, primarily negative in nature, not once have they disclosed their affiliation with Inman Incubator company, HomeLight, a product that shows production levels, similarly to AgentMatch. It is possible that this is a repeated unintentional oversight by Inman News, assuming readers should already know the company’s financial relationships.
In the seven stories, HomeLight was first referenced by writer Paul Hagey as “Google-backed HomeLight,” a phrase later repeated in a story quote by Move Inc.’s CRO, Errol Samuelson, however no possible conflict of interest was disclosed by Hagey or fellow writer, Andrea V. Brambila in their stories.
In the seventh article, founder Brad Inman penned a piece called “Taking a stand on agent data,” failing to disclose his company’s affiliation to HomeLight, nor their long-term sponsorship agreement with Move, Inc. Negative reviews are a critical part of news coverage, but the problem here lies in the seven articles where no comparison was made to an Inman-supported competitor, and no disclosures offered, which is exactly how the news industry offers fair coverage and makes clear the possible conflicts of interest.
The reason we wrote about AgentMatch is not because Realtor.com sponsors a few of our events, but because it can’t be gamed by agents – the very reason we never covered HomeLight, yet another agent review site. The other reason we steered clear of HomeLight is because it is disconcerting for Google to have agent data, even if only transaction histories – imagine your entire transaction history as part of your Google+ profile or Google flips a switch on property data retrieval (they have the closing data, why not offer AVMs? or what if your productivity statistics have an impact on your search engine rankings?).
This is all pure speculation and educated guesses, and at this point Google is only an investor, but the point is that agents have no control over the final resting place of their data when entrusted to third parties, whereas Realtor.com’s ultimate responsibility is to real estate professionals under their operating agreement with the National Association of Realtors.
The angst is real
We believe that angst among real estate professionals is very real, but in large part, it is being guided by an Inman argument, and framed in a way to exclude comparison to a product with similar functionality, fanning the flames toward AgentMatch and away from Inman Incubator and Inman Connect Startup Alley participant, HomeLight. It remains curious that when HomeLight launched and Inman covered it extensively, there was no controversy or outrage from the real estate community, creating the perception that the introduction of AgentMatch was designed to incite controversy, potentially providing cover to and benefiting HomeLight.
Getting to know HomeLight
The landing page touts that you can find the “perfect agent based on expertise,” stating that they have two million real estate agents in their database, serving 34 markets, a far cry from AgentMatch’s two pilot MLSs which allows no reviews to influence their algorithm. Let’s take a photo tour of how HomeLight works. Click to enlarge any photo below, as we take you through how the site works. We walk through a search for an agent in Austin, where we are headquartered:
Searching for an agent – method 1
There appear to be two common methods for finding an agent on the site, and one method is by selecting a popular city in the footer of the main page. Here’s how it works:
Below features the “top agents,” and the top two are very well liked top producers in the city that happen to be team leaders. This type of result is one of the main objections agents have against AgentMatch, yet here we are, looking at HomeLight which was put in a positive light by industry news writers.
And if you’re an agent, you can claim your profile
In the top corner of the agent result, the system urges agents to claim their profile, like so:
Finding an agent – method 2
The more common method is searching immediately from the front page for a city and narrowing it down. Let’s take a tour of the second method:
So where do they get the data?
In order to get the data, HomeLight is partnered with brokers of record to pull MLS data, but HomeLight does not operate as a brokerage. The transaction data allows the algorithm to narrow down agents for the consumer, and appears to go back as far as 2009.
Reviews improve agents’ rankings on the site
The second part of the algorithm, and apparently a substantial part of the algorithm by all accounts, is reviews that agents receive through the site, so HomeLight is urging agents (especially new agents) to solicit reviews from all clients, which HomeLight says can improve agents’ rankings on the site. HomeLight says they verify reviews, either through the agent directly or by commenters’ claimed address, which they can cross reference with transaction data.
It is not a perfect system, however, and can potentially be gamed (Joe at 123 Main St never reviewed his agent, so an agent can go in and falsify a review, say they’re Joe, claim 123 Main St, and affirm it’s legit when HomeLight asks). Agents that disagree with the accuracy of a review can appeal and HomeLight promises to investigate the matter, which is tremendously helpful, but tricky – a pothole Yelp stepped into several years ago.
Show me the money
The monetization strategy is much like other agent rating sites, wherein referral fees are paid at closing by agents who receive a lead through the site, but the company will not publicly say how much these referral fees are, as they likely vary by market.
Like other sites that match agents and consumers, there are holes, for example, agents that focus on off-market listings (pocket listings, and sometimes new home construction) aren’t given credit and can lose out to competitors, and team leaders are often given credit for the group’s closings even though a handful of agents touched the transaction (as seen above in the list of top listing agents in Austin), and team members’ numbers dwindle in comparison.
But unlike many competitors, HomeLight offers an opt out process so agents can remove themselves from their website, but not necessarily from data stored on HomeLight servers. This highlights, yet again, the uncertainty attached to a third party being given industry data.
Our only dog in this race are members, and our policy has always been, when in doubt, we default to the consumer if the benefit to membership is unclear, and when it benefits the consumer, it ultimately benefits the membership. That said, we have never supported blindly giving data to third parties when arms of the membership (like Move, Inc.) which are beholden to members, can provide the same service.
Update: on November 29th, we redacted the phrase “labeled as news rather than opinion” from this editorial.
