I was just looking over the finalists for the 2006 Inman News - Innovator Awards. One thing that struck me how many of the companies are "Listings Aggregators". Listing aggregators are companies that pull together real estate listings on a national level and present them to consumers. Three that I see prominently mentioned are Trulia, PropSmart and Google Base. There are many others, some very well known that aren't on the list such as Craigslist, Point2, realtor.com, etc.
These sites use a several different methods to get their listings. Some directly from agents/brokers, others from scraping sites, and some via MLS's (something that is borderline impossible on a national level) There are a few different business models. The most common one seems to be mixing advertising with listing search. This advertising model seams to be the least evasive from an agents/brokers stand-point. The agents get free exposure for their listings and the "listings aggregator" gets advertising revenue.
Ultimately, I think that we will see one of these companies pull away from the pack and become synonymous with home search, in much the same way Google did with the more generalized Internet search. Just as msn and yahoo still are battling for the remaining (sizable) chunk of the search market there will probably be two secondary, national home search sites. I think it's still too early to tell who these big three will be and I expect several more major entrants to make a splash into this market within the next year or two. Could Zillow be one? Or will a large national real estate franchise like RE/MAX do something truly innovative?
One thing is for certain, not only will the eventual winner have to win the battle for consumers, but also the battle to allay the fears of agents and brokers. This is something many new "real estate technology" companies seem to just now be realizing.
-Matt Heaton (ActiveRain CEO)
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Matt, do you think those who scrape will be in trouble for copyright violation?
In looking at PropSmart & GoogleBase they may have an issue with what unscrupulous agents have done on Craigslist, mainly adverstising listings belonging to other agents & brokers. It's unlikely they are abiding by NWMLS Rule 190.
There's an agent who contributes to Rain City Guide posting listings on PropSmart claiming to be the listing agent, yet those listings belong to another broker.
Since they're either scraping or getting listings from other agent sites who may not have authority to re-display on 3rd party sites, it seems they're running afoul of copyright and NWMLS Rule 190. Once the listing owners and the NWMLS start cracking down, these sites could implode.
Finally, they also seem like many of the FSBO sites...with many outdated listings. Consumers will eventually find little value in these sites if listings aren't current or are only showing a fraction of listings.
One of the new players I like is Homethinking. I think they have a great concept with agent reviews; I think consumers will like it. It has a long way to go - agents are predominantly with CBB and C21, a search MLS feature goes over to Homegain, the listing data is inaccurate and they're going to have to rely on agents for sold data since they not a member of the NWMLS...yet. Nonetheless, I like to see them succeed.
Zillow is at least joining MLS' so who knows, they could eventually become a national home search site.