Tag Archives: Zillow

Zillow Acquires Dotloop – I Chat With Errol and Austin, and Have Initial Thoughts

Earlier today, Zillow announced it was acquiring dotLoop, the popular real estate transaction management platform company. The terms of the deal were not disclosed. The press release is here:

Zillow Group (NASDAQ:Z), which houses a portfolio of the largest and most vibrant real estate and home-related brands on mobile and Web, today announced it has entered into a definitive agreement to buy DotLoop, a Cincinnati-based company that simplifies real estate transactions by enabling brokerages, real estate agents, and their clients to share, edit, sign and store documents digitally. The transaction is subject to the satisfaction of customary closing conditions and is expected to close in the third quarter of 2015.

Over the next 48-72 hours, you may expect to see the traditional industry freakout that happens whenever Zillow does anything. Expect everything from predictions of doom for Zillow, doom for brokers, doom for dotLoop, doom for everything and everybody under the sun.

Now, I do think the acquisition is interesting on a whole lot of levels. But I haven’t thought through all of those yet, and the deal is merely announced, rather than closed. So details are thin on the ground.

I did just get off a conference call with Errol Samuelson, Chief Industry Development Officer of Zillow Group, and Austin Allison, CEO of dotLoop where we chatted about the deal at a high level. I figured I should relate that conversation, and then maybe do my think-out-loud deal at the end as a bonus.

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MLS Conversions and Zillow Hate

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I’ve been engaged on a project that is both interesting and important for a large regional MLS the last couple of months. As part of that project, I’ve spoken to dozens of people — brokers, agents, Association leadership, MLS leadership, etc. — about a variety of topics, which has been, to quote Tony the Tiger, grrrrreat!

One of the side benefits is that I hear about people’s concerns, and one of those got me thinking. Here’s my thesis:

MLS conversion angst and Zillow hate both come from the same place.

Say what? Let’s dive in.

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What If Real Estate Brokers Worked Like Car Dealerships?

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My friend Eric Stegemann, whom many of you already know as a frikkin’ brilliant dude who runs Tribus, posted something on Facebook today and in our banter, got my thinking going.

Here’s his post:

And obviously, you can see my comments too.

I thought the similarities between car dealers and how they feel about automotive third party websites (like TrueCar) and real estate brokerages and how they feel about real estate third party websites (like Zillow) were superficial at best, because of vast differences in the business model of car dealerships and real estate brokerages.

But that got me wondering… what would it look like if real estate brokerages actually functioned like a car dealership did?

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Realtor.com Tries to Get the Balance Right

Without question, the big topics coming out of NAR Midyear Legislative Meetings were  about RPR-AMP, Upstream, and the future of the MLS. I’ve already written a few posts about them, and expect to write more in the future. But lost in all of that was a big rebrand and relaunch by Move of Realtor.com. For what it’s worth, I really like the new logo and the rebrand. As Ryan O’Hara says in the Inman article:

“Everything’s about real — real knowledge, real data, real insight,” said Move CEO Ryan O’Hara.

We shall see whether Move can live up to that brand promise, given that it does not control the one million plus local touchpoints of their Realtor brand, many of whom are only distantly acquainted with concepts like “real knowledge” and “real insight”.

But this post isn’t about the rebrand. It’s about the ideas that appear in Realtor.com’s Open Letter to the Industry that was distributed at the MLS sessions. Here’s a PDF of the letter, courtesy of BayEast. The three bullet points are:

  • Respecting the economic interests of the industry by not commingling FSBO listings with brokerage firm listings;
  • Not displaying value estimates on “for-sale” properties because the local real estate professional is the best person to determine the value of a listed property; and
  • Displaying the online reputation of brokers and agents in a way that both meets consumers’ needs to find the “right” professional while also being done in a fair way for the industry.

I wonder if these goals are even achievable. Can this balance between consumer interests and the industry’s interests really be struck?

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Syndication vs. IDX By the Numbers: A Response to Sam DeBord

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Reader, thinker, and frequent commenter Sam DeBord has written a rebuttal over at GeekEstate to my declaration of vindication re: IDX = Syndication:

IDX creates efficiency for brokers, which increases financial profitability for the group as a whole.  Syndication is a less-efficient platform in terms of overall brokerage profits.  Real estate is, on an annual basis, similar to a zero-sum game.  There are only so many transactions, and commissions, that will occur based on the market.  Financial profitability is dependent on earning as large a portion of that commission pool as possible.

Read the whole thing.

I think Sam’s written a thoughtful rejoinder, and introduced a hitherto unexamined argument: that IDX increases financial profitability for brokerages. I’d like to delve into that a bit.

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