If the history of industrialized society has taught us anything, it’s that in order to stay relevant, an entity (e.g., an institution) has to change with the introduction of any new technology. Trulia and Zillow — online listing sites for real estate properties for sale — are in the position of being that new “technology,” and have been grappling with attacks from real estate brokerages for as long as they’ve existed. Real estate brokers’ largest criticism of these sites has been that they’re incomprehensive and inaccurate, wasting both the consumer and the seller’s valuable time and money.
The latest attack comes from Redfin, an online real estate brokerage firm, bolstered by a study that compares the comprehensiveness and accuracy of real estate listings on Zillow, Trulia, Redfin, and the sites of two regional real estate brokerage firms, Windermere and Long & Foster (Wingfield, 2012).
Here’s what the study found:
“The study, conducted by a real estate consulting firm called the WAV Group, looked at a sample of 6,401 home listings in 33 ZIP codes from 11 metropolitan areas in the United States. It found that Redfin, Long & Foster and Windermere all had 100 percent of the agent-listed homes for sale, while Trulia had 81 percent and Zillow had 79 percent.
The study also found that 36 percent of the agent-listed properties shown as active listings on Zillow and and 37 percent of those on Trulia were no longer for sale on the local multiple listing service, or MLS, the local associations around the country through which agents share their property listings. The study said that 0.1 percent of the listings on Redfin and 1.7 percent of the listings on Windermere’s site were no longer for sale. All of Long & Foster’s listings mirrored their status in the local MLS.”
Compared with the finding from 2008 that Trulia had 70 percent of agent-listed homes, an improvement of 11 percentage points to 81 percent certainly qualifies as “progress,” and I predict that the numbers will only improve. Real estate brokers, however, continue to target these sites.
Jim Abbott, president and managing broker of ARG Abbott Realty Group, released a video in January in which he offers his stance on the practice of what he calls “listing syndication websites,” (LSWs) shortly after his company pulled their listings from Trulia and other online real estate sites. Unfortunately, in his seven-and-a-half minute diatribe, he doesn’t say all that much. The viewer is left with the message that LSWs are destructive, but isn’t much more informed about the reasons why than before s/he watched the video — a very dubious rhetoric.
Here’s the video:
Mr. Abbott’s video probably would have been more useful had he focused on one specific argument for the whole seven minutes, rather than briefly describing all of them. Having said that, his strongest arguments are twofold:
First, he accuses LSWs of redundancy, clogging the system with duplicate and obsolete data that is less than useless because it wastes time, confuses, and thus makes real estate transactions less efficient for both the buyer and the seller. While the line of logic to his conclusion is weak, the premise of redundancy is true, but I suspect that the system will only improve with time. For instance, Trulia is actively improving the quality of their listings with Trulia Direct Reference, a system which “allows MLSs, brokers and agents to identify discrepancies between real estate listings from MLSs and listings on third-party syndication sites” (Inman News, 2012). Trulia announced last month that all five MLSs in the San Francisco Bay Area had signed up for its quality assurance system (Inman News, 2012).
“Trulia introduced the system last year. Participating MLSs provide Trulia Direct Reference with accurate data on factors such as list price and status. The system then automatically reports discrepancies back to the MLS, broker and listing agent. The agent then has the option to visit the third-party sources and correct the information. MLSs can participate in the system at no cost whether or not they syndicate listings to Trulia” (Inman News, 2012).
But if real estate brokers determine that Trulia delimits sales even after the implementation of Trulia Direct Reference, then they should stop permitting the sites to list their properties.
However, many brokerages report that Trulia does increase traffic to their sites:
“Trulia.com is one of our top online traffic referrers, and they consistently deliver more quality traffic to interorealestate.com than Realtor.com and/or the local online newspaper sites with whom we work. Trulia sees our Web site as a customer destination, and they measure their performance by both the volume and quality of traffic they deliver to our Web site.” — Derek Overbey, Director of Marketing, Intero Real Estate
And according to a study Trulia conducted in 2009:
“The rate of Trulia visitors directed to a broker Web site, qualified by the broker and then sent to an agent was 12.32%—26% to 40% higher than traffic originating from other large online traffic sources included in this case study. This rate is also high considering all of the lead points on a broker Web site.” Additionally, “Trulia consumer leads started working with brokers’ agents 26%-40% more than that of other large online traffic sources” (Trulia, 2007).
Secondly, he compares LSWs to Napster, the original online sharing site, based on the idea that listings are “intellectual property,” which he tacitly assumes by making the comparison but never justifies — very seductive. But even if we grant him that, his argument that LSWs promote the theft of intellectual property could also be said of Google or any other search engine for that matter, even the Internet itself. If he wants to stay consistent in his logic, then he necessarily must denounce any and all technology that enables its user to potentially pirate intellectual property, e.g., the Internet, public libraries, Xerox machines, DVD-R burners, etc. Furthermore, the premise that photographs and videos on LSWs exploit photographers and videographers ignores that the photographers and videographers got paid to produce the photographs and videos in the first place, and that the majority of the “intellectual property” on LSWs were permitted by their authors/owners to be there. As I said above, if they feel that their “intellectual property” could potentially be thieved by listing on LSWs, then they shouldn’t permit it to be listed on LSWs.
Online listing sites such as Trulia are simply another tool. If brokerage firms don’t like the tool, then, obviously, they shouldn’t use it.
This situation seems very much like other situations where a new element is inserted into a traditionally closed system that has operated in a particular way to the benefit of certain groups within that system; the new element threatens the group’s specialty and they naturally become hostile to it.
Here’s the follow-up video Mr. Abbott made in May:
Inman News. “Trulia Working with More MLSs on Listing Data Quality.” Real Estate News for Realtors and Brokers. Inman.com, 28 Sept. 2012. Web. 23 Oct. 2012. <http://www.inman.com/news/2012/09/28/trulia-working-with-more-mlss-listing-data-quality>.
Trulia. CASE STUDY Highlighting Broker Successes with Trulia. Images.trulia.com. Trulia, 2007. Web. 23 Oct. 2012. <http://images.trulia.com/resources/Trulia-Highlighting_Broker_Successes_Case_Study.pdf>.
Wingfield, Nick. “On Big Real Estate Sites, Study Finds Gaps in Listings.” Bits Blog. NYTimes.com, 3 Oct. 2012. Web. 19 Oct. 2012. <http://bits.blogs.nytimes.com/2012/10/03/on-big-real-estate-sites-study-finds-gaps-in-listings/>.