Zillow goes head to head with your wallet
Today, Zillow is announcing that they will begin charging $9.95 to manually upload listings for a period of 180 days and current listings will be given a 30 day grace period in which to opt in or out. Zillow’s move to charge for listings seems like a small price but is just another chipping away at Realtors’ pockets and may be an insurmountable expense for agents whose primary business is lease listings, because as consumers discover an alternative to Craigslist, they will come and agents understand that they must be there to meet them. But, imagine you as a single agent, currently holding 38 listings in the city, you’re expected to shell out $378.10 up front and again at the end of 180 days if your market doesn’t move quickly. In other words, if your listing isn’t fed through the MLS data feed, you’re going to pay for it. Sorry rural or small brokers, give up (your listings) or pay up.
Chloe Harford, Director of Strategic Planning at Zillow, said that this project will grow over time and that Zillow is not yet set up for a bundle package offering for listing entries. David Gibbons, Customer Relations Director told us that Zillow will be examining how to offer a pro account or bundle package because if every agent who wanted to post a listing wanted to discuss the charges, “taking the phone call alone obliterates the margin.” I predict a pro or bulk account will launch sometime after the first 180 days so everyone has to throw their wallets into the wishing well first without a discount (but maybe that’s the cynic in me having watched agents get burned over the years by most tech startups now known as media companies).
Zillow goes head to head with Realtor.com, RPR
Gibbons told us multiple times in a call today that Zillow “pioneered concept of one property record for every home in the country” which sounds a lot like the recently launched Realtors Property Resource (RPR), although it is different in that it faces millions of consumers rather than one million agents in an intranet fashion.
Why is this a threat to RPR? Because RPR is young and although it serves as an inward facing product for people belonging to the National Association of Realtors, Zillow already has a huge chunk the market share as the second largest real estate search site which enjoys over 8 million visitors each month (and they are still growing phenomenally- 60% over 2008 alone).
Why does the announcement of adding lease listings threaten Realtor.com? Because on top of being a one stop shop, they already have over 4,000,000 listings currently for sale on the site and a total of 90,000,000 in their database and more feeds continue to be fed into their system along with manual entries (FSBOs, etc) meaning that they’re closing the gap between them and Realtor.com in size. Zillow has consistently owned the “cool” factor over NAR and it’s of no fault of the Association, but because a startup with swag that goes to tech parties will always have more energy and buzz surrounding them than the “establishment.”
Jim Duncan, Charlottesville, VA Realtor said, “I was struck by David’s repetition of “one property record for any property in the country” – it sounded very similar to RPR. Zillow are the ones who have been able to effectively implement the “one property record” concept. They’re certainly not the first to do it, and clearly aren’t the last, but they are the ones who have implemented this concept. Once someone has critical mass – of records and consumers who recognize said critical mass – then that company is well positioned to be the de facto leader in the space.”
Gibbons noted, “Zillow always planned to differentiate itself as “the database of ALL homes.” As such, knowing which homes were for rent were part of the plan all along but as a startup with constrained resources in a volatile, sequencing these things is important.” This assertion puts a target square on the RPR and Realtor.com.
Also as an alternative to existing establishments, Zillow positions itself in advocacy role. “In today’s volatile housing market, many would-be sellers are opting to rent for a few years and ride out the market, while many home shoppers are just trying to decide whether to buy or rent,” said Spencer Rascoff, Zillow Chief Operating Officer. “With the launch of rental listings and search, we are arming our more than 8 million monthly users with information, tools and options to make the right housing decisions for them today.”
Zillow goes head to head with all sites that have mapsWhat Zillow should be commended for is their taking on the lofty goal of mapping out neighborhood boundaries which launches today. Gibbons said that this feat is “tricky because there is no regional database with neighborhood boundaries,” but notes that it will lead to stronger search. This feature has received little notice and Zillow barely mentions this tool that allows iterative features and enriches their search function but they even have an intern devoted to implementing the neighborhood outlines. When complete, it will be the first national database of neighborhoods which is a massive undertaking.
To learn the details of the other half of Zillow’s news release, click here.
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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