The break up of ListHub and Zillow. So the hot topic this week has been the apparent falling apart of the National Association of Realtor’s (NAR) relationship with Zillow and Trulia. In a recent announcement by the NAR, ceo Rupert Murdoch says that the NAR will no longer supply MLS property listings to Zillow and Trulia through NAR’s subsidiary company, ListHub.
A little background. Most of you already know that Trulia, Zillow, and Realtor.com are the top three most visited real estate sites in America. This is because they have real estate listings from every town in American, unlike local sites like this one that specialize in showing real estate listings in a specific area. Recently Zillow and Trulia merged together, making them collectively the largest real estate portal on the internet. Realtor.com gets all of their listings from real estate brokerages like Shreveport Real Estate, LLC. In order for us to be members of the National Association of Realtors, and participate in the MLS, Realtor.com forces us to share MLS data with them. It kind of sucks because the data technically belongs to the real estate brokers that create the data, but in order to get your properties sold we participate so that exposure is maximized. I wish we could share the data with participating cooperative brokers and not Realtor.com. I’ve never been a fan of behemoths trying take over everything. I like it how it was 5 years ago when you searched for real estate, and listings from all the local brokers in the area appeared instead of these one-site-for-everybody places. (I also feel the same way about Amazon’s takeover of internet shopping, but that’s another story.) According to Inman News, Zillow and Trulia have relied on Realtor.com’s subsidiary, ListHub, for 60% of their data!
Say what!? How will Zillow Survive when ListHub is pulling 60% of their data!?
While I write this article Zillow has 2.8 million homes for sale on their website. If ListHub takes away 60% of them then that leaves 1.1 million. Sure that’s still a lot of homes for sale, but let’s put that into prospective. If there are 10 houses in your neighborhood listed on for sale on Zillow then that means only 4 houses will be listed for sale on Zillow once this is said and done! And the other side of this is that ListHub maintains the accuracy of the listings they provide to Zillow. Most people know Zillow has earned a reputation of having inaccurate and stale listings on their site. I would venture to say that any accuracy Zillow does enjoy is a direct result of the efforts of ListHub.
But Zillow says they’ve got it all figured out
Zillow says they will get the data from Brokerages. Does Zillow really think this will happen, or are they just saying this so their stockholders don’t fly the coop? According to Zillow themselves they will no longer get listings from ListHub, and they plan to fill this enormous void by getting the data directly from the many thousands of real estate Brokers across the land. What? I can’t speak for all real estate brokers, but they aren’t getting the data from Shreveport Real Estate, LLC! Unless they were to do something that drastically changes our minds then we view Zillow as a competitor. Furthermore we believe that:
- Zillow is sloppy with there data management and is doing a disservice to the real estate community (buyers, sellers, and agents alike) by wasting our time with inaccurate and stale data.
- Zillow uses extortion tactics on real estate agents. Since Zillow is a big company they spend lots of money trying to rank more prominently than local real estate firms on search engines. By doing this it gets them more traffic to their website whereby they capture leads and try to sell them back to real estate agents. And quite frankly Zillow has been very successful at getting real estate agents to pay for leads. For us, we just think there’s something fundamentally wrong with giving Zillow real estate data, then having them misuse the data to commit extortion tactics against the real estate industry. And Trulia does the same thing.
Real estate agents may be at risk. Many real estate agents have invested large sums of money into advertising, or as Zillow puts it, “Going Pro”, on Zillow’s and Trulia’s websites. To me it’s just buying leads, but some guys like to put a fancier title to it. And furthermore a large portion of these real estate agents stand to lose a lot because buying leads from Zillow and Trulia is where they get 100% of their business from. It is their plan A and their plan B!
Having said that, Zillow is a big company with deep pockets. Maybe they have a genius up there in the Zillow throne that has a plan. Is this a move by Zillow to drive more real estate market share to themselves? I guess we’ll only find out when we start to see all of this unfold beginning April 2015. I plan to revisit this article with updates, and please post your comments!