If you’ve ever been to Austin, you know that the phrase “Keep Austin Weird” is around for a reason, and that the enthusiasm about living in the city is palpable. There’s this quiet, giddy smile on local faces as part of an unspoken bond that unites residents like a web. It’s oddly kumbaya-ish as gun totin’ rednecks, inked up art snobs, university students, and philanthropists can sit in any restaurant together, happily eating tacos and chatting about their favorite local swimming holes. According to the U.S. Census Bureau, 110 new people move to the Austin area every single day, and the growth spurt that started in the 80s continues to rapidly accelerate.
So what better place to test a new rental listings program than a diverse city with an influx population, and a very, very, very healthy rental market? And who better to write about such a mysterious pilot program than a native Austinite who also happens to be a renter who might use the site, and also happens to be a real estate writer that will offer an unfiltered first look and the raw product?
Introducing Doorsteps Rent
Introducing Doorsteps Rent, powered by realtor.com. They’re testing what they’re calling a “rental experience,” starting with Austin as the pilot city, and they’re offering a “hyperlocal, content-rich experience” with editorial content alongside listings. You can learn about the flavor of a neighborhood, why the market is so hot (ahem: increasingly expensive), and it’s all original.
If this had existed a decade ago, it would have negated endless content generation real estate professionals have had to do to explain the rich history and current feel of specific neighborhoods.
Take a gander at the screenshots we’ve nabbed, and note that the design is clean, modern, has an urban feel, and is overly simple to use (a win for smartphone-using renters on the prowl):
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So where does all the data come from?
One of the challenges of multi-family rentals is that the software they’ve been using for nearly two decades, adjusts prices by the hour based on supply. If there are two 3-bedroom units left on the property and one leases, the price on the remaining unit instantly goes up. If four 2-bedroom units skip in the first week of the month, the glut pushes the pricing down to move them. This makes it nearly impossible for rental search to be accurate, which is why the industry continues to post price ranges instead of unit prices.
This makes the data flow complicated – imagine if prices of homes for sale went up and down every hour based on a computer algorithm.
Where does all of the data come from? The company tells us that they have the same MLS feeds that are syndicated to realtor.com (so real listings uploaded by real realtors), direct feeds from apartment communities, and data feed agreements with third parties that include apartment communities and single units (for example, we immediately saw listings flowing through Appfolio).
They note that in most cases, their listings are updated every 15 minutes, and they tell us that they are “working towards real time unit level availability and pricing, collaborating with property management software providers on those integrations.” Bingo.
Is Doorsteps going away?
A lot has changed at Doorsteps since its inception three and a half years ago – in 2013, the small company that provided a knowledge base for home buyers was acquired by Move, Inc. (operator of realtor.com, which itself was acquired by News Corp. in 2014), to much fanfare, they launched Doorsteps Swipe, the beautiful app that reminded everyone of Tinder but for real estate.
This summer, founder Michele Sero left to pursue other opportunities, but her team remained and have been hard at work on the company’s evolution, all under the continued theme of humanizing real estate search by educating consumers.
The company tells us that Doorsteps has always been an educational vehicle for homebuyers, but they’re “exploring the extension of that relationship to serve the needs of renters today.”
Why Realtors should care about the pilot
Doorsteps says the idea behind the product is not only to extend that relationship, but to offer a more targeted search experience and better understanding of neighborhoods as a means of yielding better rental leads.
Christie Farrell, Director of Corporate Communications at Move, Inc. tells us, “the rental market is a huge opportunity for Move to do what our vision is – connect realtors and consumers, and to provide consumers with the best possible and most consistent and reliable experience online.”
We translate that to mean that this is one more way to keep consumers focused on the realtor brand and fill the pipeline earlier on in the process.
How long will the pilot last?
The company does not have a set date for the pilot program to either end or blossom into a national offering, but we were assured that it would be months, not years.
They’re currently looking to measure the impact and effectiveness of Doorsteps Rent and see if the hyperlocal content resonates with renters – this process doesn’t take place overnight.
Monetization of the product
Based on who owns it, Doorsteps is officially a media company, which means they bank on advertisers. There are no current ad products on the site, and the company has not finalized their offering, but here is where it gets sticky.
The big pink blowup elephant in the room is multifamily budgets – rents have gone way up nationally, and especially in Austin, so the properties must be rolling in extra cash, right? Not really – they’re actually reinvesting that money into remodeling units, building new amenities, and improving the property. Our sources tell us that marketing budgets have changed very little in the last decade, despite increased profit margins.
Why does it matter if Doorsteps Rent is another line item on a budget sheet for a property manager? Because Austin is this rare little town where thousands of apartment locators (many of whom are licensed realtors) live on this same marketing budget. The rental market is so hot here, that many properties have already cut locator commissions simply because they don’t need them. It’s already a struggle.
If properties’ marketing budgets are gobbled up by Doorsteps Rent, so are the incomes of locators, and we can’t imagine that a realtor-branded product would ever intend on damaging their constituents.
So if the advertiser isn’t the property, then who is the advertiser? Realtors and apartment locators that want to have their headshot posted up next to rental listings? Or will featured listings be the bread and butter? Perhaps banner ads will hit the sweet spot. All Move models are free to consumers, so the end user won’t be the one padding the coffers, but the direction they head with the monetization will dictate whether or not the real estate practitioner backs it.
The product speaks to the greater good
If you’ve searched for rentals on the big portals, you’ve already seen that there are some serious accuracy problems. Spend five minutes searching sites that don’t rely on MLS data, and within that time span, you’ll find listings that aren’t real, or are straight up scams. Trust me, it only takes five minutes.
This has done a lot of damage to the rental industry – portals allowing bad listing data to be uploaded has abused the consumer and destroyed the trust between real estate practitioner, consumer, and even search portals.
If a consumer spends time on Doorsteps Rent and finds the data to be accurate (and we hope it is, even though unnamed third parties will be feeding data to the site), this could play into the national campaign between realtor.com and the National Association of Realtors to re-establish trust and faith in the industry.
What we hope the future holds
There are three things we hope the future of Doorsteps holds: Swipe update, UGC, and AI. Let me explain.
First, if Doorsteps Rent does not lead to a Swipe product for rentals, I will literally lose my mind. If you aren’t familiar with Swipe, go spend five minutes on it and tell me you’re not hooked and suddenly in the market for a house .
Second, it would make sense for this to finally be the place where some user-generated content (UGC) is opened up. It can’t exactly be done on realtor.com, because a random consumer adding comments to a listing could be extremely tricky, given how highly regulated it is. But, I imagine Doorsteps Rent could very easily be the Yelp of neighborhoods, with consumers adding pictures of what they’re up to in the area, the newest fish taco place (eww, but whatever), or how the new highway development is impacting commutes, and so forth. I doubt there will be any star ratings, but I predict that consumers will be invited to participate in the process not only for the added benefit of unfettered content, but because their creating a login to do just that means one more contact opportunity for realtor.com and the incubation of consumers much earlier in the sales cycle.
Lastly, I should note that this pilot marks the first step in personalization for renters, an often overlooked segment of the population. After this step comes geo-targeting and maybe the acquisition of a company like Nextdoor, a private social network that enables members to communicate with neighbors. After that, I hope the ultimate evolution of Doorsteps Rent will include more predictive search that understands a consumer’s desires based on their past rental experiences, but that’s like hoping for the site to be complete with artificial intelligence. A girl can dream.
The final verdict
Doorsteps Rent is an important piece in the puzzle. For years, the image of real estate practitioners in the rental field has been tarnished by the bad behavior and greed of non-MLS search portals, and consumers have been left to use subpar sites with subpar information.
Personalizing the process with this gorgeous, urban design, brings future homebuyers into the fold much earlier, which is a huge win for realtors.
Ultimately, the success of the pilot depends on the monetization strategy, a strict devotion to data accuracy, and quality content that resonates with renters.
We believe the pilot will succeed and anticipate that it will become a national offering. We predict that it will ultimately lead to a Doorsteps Rent Swipe product, future acquisitions to better connect neighborhoods, and the evolution of the site into a Yelp/Doorsteps hybrid.
Zillow continues to build their patent collection – looking back, is anyone surprised?
(REAL ESTATE CORPORATIONS) The real estate giant Zillow continues the trend of the last decade and even adds another four patents to their ever growing patent collection.
In 2006 Zillow, the online real estate marketplace company, hit the world scene. Little did we know that this little website would explode over the last 15 years into the massive business venture it is now. Total assets in 2019 reached up to $6.1 billion. The founders, Rich Barton & Lloyd Frink, have been building this company from the ground up, pulling in new acquisitions and pursuing new avenues of revenue. Always adventuring into the next frontier of real-estate, and taking a patent or four along the way.
In a new move that surprised real-estate moguls around the country, Zillow Mobile was developed and they began creating mobile applications (listed below). However, I don’t think anyone expected what this would lead to in 2018.
- April 29th, 2009 – iPhone Application
- March 18th, 2010 – Android Application
- April 2nd, 2010 – iPad Application
- March 31st, 2011 – Blackberry Application
- July 13th, 2012 – Windows Phone Application
- November 27th, 2013 – Windows 8.1 Application
- November 2015 – Apple TV Application
Once these apps were in place Zillow announced some news that would rock the real-estate world, Zillow Offers. The app provides a unique position for the company to directly purchase a seller’s home from them and do all the work to sell. Completely eliminating the go between aspect of the job. In the first year of this and leading into 2020, the company took a massive hit to their revenue because of the front end of purchasing all of this property.
Zillow 2.0 is still holding strong however. The current CEO Rich Barton is not worried about the downswing. He has been molded in the world of business over the years, having learned about the benefits of “risk that is tempered” while he founded/co-founded Expedia and Glassdoor. This business guru is a force to be reckoned with.
These highly aggressive tactics don’t just stop at the purchasing arena either. Over the last 15 years the business has acquired 21 patents. The patents in recent years are starting hedge competitors into a tight spot. Listed below are some of the more recent patents that have been cleared.
1. “Automated Control of Image Acquisition Via Use of Mobile Device User Interface” – Filing Date 8/21/2020
- Techniques are described for using computing devices to perform automated operations to control acquisition of images in a defined area, including obtaining and using data from one or more hardware sensors on a mobile device that is acquiring the images, analyzing the sensor data (e.g., in a real-time manner) to determine the geometric orientation of the mobile device in three-dimensional (3D) space, and using that determined orientation to control the acquisition of further images by the mobile device. In some situations, the determined orientation information may be used in part to automatically generate and display a corresponding GUI (graphical user interface) that is overlaid on and augments displayed images of the environment surrounding the mobile device during the image acquisition process, so as to control the mobile device’s geometric orientation in 3D space.
2. “Estimating the value of property in a manner sensitive to nearby value-affecting geographic features” – Filing Date 7/7/2014
- A facility for determining an estimated value of a home is described. The facility applies a first valuation model that is insensitive to value-affecting geographic features near the home to obtain a first valuation. The facility applies a second valuation model that is sensitive to value-affecting geographic features near the home to obtain a second valuation. The facility combines the first and second valuations to obtain an estimated value of the home.
3. “Automatically determining a current value for a real estate property, such as a home, that is tailored to input from a human user, such as its owner Utility Patent Grant (B2)” – Filing Date 9/4/2015
- A facility procuring information about a distinguished property from a user knowledgeable about the distinguished property that is usable to refine an automatic valuation of the distinguished property is described. The facility displays information about the distinguished property used in the automatic valuation of the distinguished property. The facility obtains user input from of the user adjusting at least one aspect of information about the distinguished property used in the automatic valuation of the distinguished property. On a later the day, facility displays to the user a refined valuation of the distinguished property that is based on the adjustment of the obtained user input.
4. Providing Simulated Lighting Information for 3D Building Models – Filed Date 4/6/2020
- Techniques are described for using computing devices to perform automated operations related to, with respect to a computer model of a house or other building’s interior, generating and displaying simulated lighting information in the model based on sunlight or other external light that is estimated to enter the building and be visible in particular rooms of the interior under specified conditions, such as using ambient occlusion and light transport matrix calculations. The computer model may be a 3D (three-dimensional) or 2.5D representation that is generated after the house is built and that shows physical components of the actual house’s interior (e.g., walls), and may be displayed to a user of a client computing device in a displayed GUI (graphical user interface) via which the user specifies conditions for which the simulated lighting display is generated.
But what do these patents do to the market? They are cornering their position as THE online real estate company. The stranglehold on any competitors is going to be hard to fight. The numerous patents typically tend to revolve around automated or multi-faceted searching and pricing on people homes. One of the newest ones actually takes images and translates into pricing.
This patent trolling technique is definitely something to take into account for other companies. This way, businesses hold their top place is to sue people into the ground with scrupulous patent lawsuits based on patent law. They throw red tape and paper on top of new competitors to drown them in fees before they can actually become competitive. Personally, I find it disgusting but from what I’ve learned, that’s capitalism at its finest. Beat them down with paper so you can stay on top.
REX anti-trust lawsuit accuses Zillow, NAR of being in a ‘cartel’
(REAL ESTATE) Real Estate Exchange, Inc. (REX) is suing Zillow and NAR, alleging a cartel wherein non-MLS members like themselves are edged out of the marketplace.
Real Estate Exchange, Inc. (REX) has today filed an federal anti-trust lawsuit against Zillow and the National Association of Realtors (NAR).
REX accuses NAR of “non-negotiable” compensation structures baked into the MLS, an assertion that has been proven otherwise in the past.
They go on to accuse Zillow of making changes recently to their site that makes “non-MLS listings accessible only via a recessed, obscured, and deceptive tab,” leading to REX’s listings (on Zillow) losing traffic, “severely impacting REX’s reputation, its ability to execute its innovative and disruptive business model, and driving consumers away from REX and back into the MLS regime, ensuring higher commissions that benefit NAR’s members” which they say ultimately disadvantages consumers.
REX claims that Zillow (and other real estate aggregators) have helped them “to maneuver around the NAR/MLS cartel’s high commission structures” by aiding them “to reach a large audience of potentially interested buyers.”
But then Zillow went and became an ibuyer, shifting their focus from search to owning inventory, eventually joining NAR in 2020.
REX accuses Zillow of hiding non-MLS listings like theirs through their redesign. All of their homes are listed by a licensed real estate agent, but they are not NAR members and proclaim they never will be.
The crux of REX’s argument is that as a newly minted member of NAR, Zillow must follow rules set by NAR (which is done by members in committees, not the executives), and so they have joined forces to conceal non-MLS listings on Zillow’s site, thus entering into an anticompetitive posture together.
“Zillow began like so many other platforms: it served a great value to American consumers. Unfortunately, we see Zillow as backtracking on their original mission to serve consumers, instead focusing on their own profits,” said REX CEO Jack Ryan in a press release today.
In the last week of February, REX presented this case to 35 states attorneys general, leading up to their federal filing (their presentation can be found here).
In a statement to The American Genius, Mantill Williams, NAR VP of Communications states, “This lawsuit has no legal basis, and we intend to vigorously contest it. This is an example of a brokerage trying to take benefits of the MLS system without contributing to it. It has been long recognized that the MLS system provides considerable pro-consumer, pro-competition value. REX’s lawsuit seeks to undermine that consumer value—simply for REX’s own benefit.”
Williams continues, “The MLS system levels the playing field for small businesses and allows innovation to flourish, all to the benefit of buyers and sellers. The advanced MLS technology gives publishers access to all the same information, allowing buyers to see as many properties for sale in one place as possible, while simultaneously ensuring sellers have access to the largest pool of buyers. Because of MLSs, we’re at a point in the market where we’re seeing unprecedented benefits to consumers and competition among brokers, especially when it comes to service and commission options.”
A Zillow spokesperson tells us, “We are aware of the lawsuit and believe the claims are without merit and intend to vigorously defend ourselves against it. Zillow is committed to giving consumers the most up-to-date housing information on the most amount of listings possible on a single platform. As part of our switch to MLS Internet Data Exchange (IDX) feeds and becoming formal MLS participants earlier this year, we were required to make changes to the way some listings appear on the site in order to be compliant with MLS rules. As a result, when using one of our platforms to search for homes, buyers may see two options to view their search results – “Agent listings”, and “Other listings” – which include For Sale by Owner listings or Coming Soon listings not on the MLS or, for that matter, on most other real estate sites.”
They conclude, “As part of our efforts to empower consumers, we have been actively working to update the industry rules, including those around ‘co-mingling,’ to allow a seamless search experience so we can continue to display all types of listings on our platform.”
The tables have turned: Zillow being sued for violating antitrust law
(REAL ESTATE CORPORATE) A Vermont real estate company is bringing a lawsuit against Zillow for violating antitrust laws. Will it be enough to slow the real estate giant?
In a shocking upset, a Vermont real estate website is suing Zillow for violating antitrust law. The website, called Picket Fence, alleges that Zillow’s operation in Vermont led to millions in lost revenue, both past and projected.
According to court documents supplied by the state of Vermont, Picket Fence—a for-sale-by-owner business that originated and is located in Vermont—was one of the first significant FSBO businesses in the state. Picket Fence purportedly endeavored to use their services in order to connect private sellers with clients, thus negating the need for an agent or traditional real estate service.
Zillow, by contrast, is a “Foreign Profit Corporation” in Vermont. Since Zillow is located predominantly in Seattle, Washington, their presence in the state of Vermont falls under a different classification than that of Picket Fence.
The court document alleges that Zillow, by providing aggressive competition in a state other than that of its origin, deprived Picket Fence of due revenue. It also alleges that Zillow violated “state and federal consumer and antitrust laws” in addition to a handful of Vermont laws. The document refers to “unfair and deceptive acts” on behalf of Zillow, insinuating that Zillow’s operation in Vermont was damaging to FSBO services like Picket Fence.
While much of Zillow’s purported damage to Picket Fence is projected based on profit estimations from 2017, the fact remains that Zillow used the tactics they have used across the country to monopolize real estate business in Vermont. Picket Fence estimates that this will result in a net loss of over $142 million by 2030, so their case prioritizes monetary recompense.
On a separate note in the document, Picket Fence shows that Zillow’s operation and interference in Vermont prevented local FSBO and other real estate endeavors from taking hold despite the best efforts of Picket Fence. The complaint addresses this issue as another nail in the antitrust violation coffin.
Picket Fence continues to suggest that Zillow’s actions were and are illegal, damaging, and in violation of significant antitrust law. This isn’t surprising given Zillow’s long history of shady activity from patent-grabbing to lengthy court cases designed to crush competitors; it is these exact behaviors that Picket Fence is hoping to address in their complaint.
Zillow, for their part, will have to answer for a lot over the course of the last 12 months. This Vermont case is sure to be one of the first of many attempts to bring the real estate giant to its wobbly, monopoly-seeking knees—and, with any luck, it will be the first successful one.
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