Redfin flip flopping in public
Redfin recently received a round of funding that brought their total amount raised to $46 million, raised because of Redfin CEO Glenn Kelman’s ties to the tech and investing world in addition to their reputation as being “revolutionary” in the real estate industry and “transparent.” It seems the company is back to shake things up after several years of shaping itself into less of a revolution and more of an edgy real estate brokerage operating on the standard real estate team model.
Before their most recent round of funding, Kelman told GeekWire.com “If Redfin has to pay a media site for traffic, we will not be able to make real estate better,” and blogged, “The only ads we’ll pay for are the ones we show to millions of people on our own site, for free.”
In a move that the company likely hoped would not go noticed by the industry, Seattle real estate broker Marlow Harris alleges that not only has Redfin begun buying advertising but have snatched up keywords through Google Adwords to compete with brokers, at least in the Seattle market. Harris discovered that not only did the company that proclaimed they wouldn’t spend money on ads buy “Seattle Dream Homes” (the name of her company) but “Findwell” and other competitive terms.
While nothing is illegal about this and corporations do this all the time (Coke buys “Pepsi” as a keyword and Pepsi buys “Coke” as a keyword), corporations are not members of the National Association of Realtors that ascribe to a Code of Ethics for which violations can lead to revoked membership or other punishments.
Buying competitive terms
Harris told AGBeat, “While it’s not possible to tell definitively if they’ve purchased the keywords “Seattle Dream Homes”, Redfin is the only result that is consistently returned for that particular search phrase. More importantly, since they pride themselves on being so “transparent” and letting us and the press know about every little success, study, report, talking point, data change, abstraction and survey, you’d think a big new Google Adwords campaign would at least deserve a press release and a blog post by Kelman. Every other wisp of news does. Why the sudden silence, especially after making a big point in saying that they wouldn’t pay for advertising? What else has changed, what else goes hidden or unspoken?”
Realtor William Stroud of Coldwell Banker in New Mexico commented, “While using someone else’s business name in keywords or meta tags is not against Google’s terms of service, it does violate the Realtor Code of Ethics and they are members. Standard of Practice 12-10 in the Realtor Code of Ethics:
REALTORS®’ obligation to present a true picture in their advertising and representations to the public includes the URLs and domain names they use, and prohibits REALTORS® from: “deceptively using metatags, keywords or other devices/methods to direct, drive, or divert Internet traffic, or to otherwise mislead consumers.” (Adopted 1/07)”
The bottom line
Although there is more gray areas to the concept of buying keywords of a competitor in the real estate industry than typical corporations, it does raise questions. Moreover, the story here is that the company that has repeatedly told the world that they will not buy advertisement, rather stand on their own merit as they forge ahead as the real estate “revolutionaries,” their quiet change in position has people curious about the company’s stance on transparency that they are so well known for.
The Google AdWords campaign could quietly disappear overnight, but it is surprising to see this from Redfin. Redfin has not responded to our request for comment but we will add it here if they do.
“We haven’t flip-flopped”
Redfin quickly responded to our request for comment, and strongly denies buying any trademarked terms including Findwell but notes they do invest in the phrase “homes for sale in Seattle,” further noting that the metatags on Redfin’s site does not include any competitors’ names, so there is really no Realtor Code of Ethics violations that we can see, given the complexity of Google’s algorithm that is often unknown or veiled to the public.
Kelman notes that his statement on advertising wasn’t as carefully crafted as it could have been but that it involved much more context than a simple attitude against paying to advertise.
Regarding his interview with ActiveRain alluded to above, Glenn Kelman, Redfin CEO told AGBeat that “we began spending a few thousand dollars on Google keywords. This was approximately .2% of our total spending for October, and it is a much smaller fraction of our traffic. We have tried AdWords before incidentally, and couldn’t make it work. To put this spending in context, we have spent more money giving our Boston agents iPads for field use, an initiative it hadn’t occurred to us to discuss publicly either.”
Austin tops the list of best places to buy a home
When looking to buy a home, taking the long view is important before making such a huge investment – where are the best places to make that commitment?
Looking at the bigger picture
(REALUOSO.COM) – Let us first express that although we are completely biased about Texas (we’re headquartered here, I personally grew up here), the data is not – Texas is the best. That’s a scientific fact. There’s a running joke in Austin that if there is a list of “best places to [anything],” we’re on it, and the joke causes eye rolls instead of humility (we’re sore winners and sore losers in this town).
That said, SelfStorage.com dug into the data and determined that the top 12 places to buy a home are currently Texas and North Carolina (and Portland, I guess you’re okay too or whatever).
They examined the nerdiest of numbers from the compound annual growth rate in inflation-adjusted GDP to cost premium, affordability, taxes, job growth, and housing availability.
“Buying a house is a big decision and a big commitment,” the company notes. “Although U.S. home prices have risen in the long term, the last decade has shown that path is sometimes full of twists, turns, dizzying heights and steep, abrupt falls. Today, home prices are stabilizing and increasing in most areas of the U.S.”
Average age of houses on the rise, so is it now better or worse to buy new?
With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.
The average home age is higher than ever
(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.
With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.
Prices of new homes on the rise
Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.
Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?
The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.
Why Realtors are vulnerable to these rapid changes
(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub, Realtor.com, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.
Note: We’ll let you decide which company plays which role in the image above.
So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.
1. Zillow poaches top talent, Move/NAR sues
It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also Realtor.com’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.
Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.
2. Two major media brands emerge
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