You know your listings? yes the one you cultivated and worked hard for to get then input into the NAR owned MLS. That listing most often than not gets syndicated to online portals like Zillow.
And do you know what happens to your listing on Zillow if you are not a Premier Agent? You do not get that lead and furthermore it gets SOLD out multiple times to whomever!
This in my book is so wrong and highly fraudulent in part of the MLS and the NAR.
Hoodwinked Definition: 1. : to deceive by false appearance : dupe. people who allow themselves to be hoodwinked by such promises. 2. archaic : blindfold. to deceive or trick someone: hoodwink someone into doing something. He hoodwinked us into agreeing. Synonym: bamboozle informal.
The real estate industry has witnessed a concerning transformation over the past decade, one that has fundamentally shifted power away from hardworking listing agents to tech giants like Zillow. Let's examine how this happened and why it's problematic for real estate professionals.
The Birth of a Data Dynasty
What many don't realize is that Zillow built its empire using data provided by MLS systems and hardworking agents. When listings are syndicated to Zillow, they're essentially receiving valuable inventory at no cost – inventory that agents spent time, money, and effort to secure. This is where NAR failed and should of stepped in more heavily to represent agents interests and their future.
The Evolution No One Asked For
Remember when Zillow was just a property search website? Those days are long gone. In what many industry veterans view as the ultimate plot twist, the platform that built its empire on agent listings and advertising dollars has become a direct competitor to those very same agents.
The Double-Edged Sword of Technology
Zillow's transformation represents a classic case of "feeding the hand that bites you." Agents and brokers who supplied data and paid for advertising essentially funded the creation of a major competitor. This raises serious questions about the future of real estate practice:
- Can independent agents compete with tech-enabled brokerages?
- Should MLSs maintain relationships with broker-platforms?
- How can traditional brokerages protect their interests?
- What's the future role of individual agents?
SEO Domination Zillow.com vs Realtor.com
Through years of accumulating this MLS data, Zillow has achieved unprecedented authority in search engine rankings. When potential buyers search for properties online, Zillow consistently appears at the top of results, effectively positioning itself between agents and their potential clients. This dominance wasn't earned through superior service but through leveraging provided MLS data.
The above graph shows the direct results of agents feeding data into the MLS over twenty years. As a result Zillow now gets top rankings and domination in Google. This accelerated significantly after Zillow acquired Trulia in 2015, giving them more negotiating power with MLSs.
By 2015, Zillow's domain authority surpassed Realtor.com, largely because they prioritized user experience and content creation while Realtor.com was more focused on industry relationships.
Zillow's SEO dominance over Realtor.com came down to several key strategic decisions:
Early SEO Strategy (2006-2010):
- Zillow created unique content like "Zestimates"
- Generated individual URLs for every property in America, even without listings
- Built massive link equity through property data pages
Used clean, search-friendly URL structures - Created extensive educational content
- Built tools and calculators that attracted links
Zillow began acquiring MLS data through various means starting around 2006-2007, but the process evolved significantly over time. All this was happening under NAR's watch. Since most MLS's are NAR owned right?
Below is a web history of Realtor.com. As you can see it dates back to 1996 versus Zillow coming on the scene in late 2004.
Realtor.com did attempt to compete with Zillow, but their efforts were largely unsuccessful for several key reasons:
1. Reactive Instead of Proactive (2006-2014):
- Was slow to innovate due to NAR oversight
- Maintained outdated registration requirements
- Focused on defending traditional business model
- Lost early market share during crucial mobile transition
2. Failed Strategic Moves:
- 2014: News Corp acquired Move Inc. (Realtor.com operator) for $950M
- Attempted to match Zillow's features but usually lagged behind
- Made late entry into home value estimates with "RealEstimate"
- Never successfully countered Zillow's Zestimate brand recognition
3. Key Business Metrics (2015-2024):
- Zillow consistently maintained 2-3x more monthly visitors
- Higher user engagement rates on Zillow
- Better mobile app ratings and downloads
- Stronger brand recognition among millennials
4. Market Response:
- Zillow's market cap peaked near $50B (2021)
- Realtor.com remained secondary player despite NAR backing
- Zillow succeeded in becoming the consumer's first choice
- By 2024, Realtor.com primarily competes for second position with Redfin
The Lead Hijacking Problem
Here's where it gets particularly troubling: When a potential buyer finds a listing on Zillow and clicks to learn more, they're often not connected with the listing agent who actually secured and marketed the property. Instead, the lead is frequently sold to Premier Agents who pay Zillow for that zip code's territory. This practice essentially:
- Intercepts leads that should naturally flow to the listing agent
- Forces agents to pay to receive leads on their own listings
- Creates an artificial barrier between listing agents and potential buyers
The Financial Impact
Consider this: An agent spends thousands of dollars on:
- Marketing to secure the listing
- Professional photography
- Staging consultations
- Property preparation
Yet, when an interested buyer finds the listing on Zillow, the connection to that agent's investment is severed, and the lead is sold to the highest bidder.
A Question of Ethics
- Should a platform be allowed to profit from redirecting inquiries away from the original listing agent?
- Is it fair to monetize access to leads generated from listings that agents provided for free?
- Should agents be required to pay to receive leads on their own listings?
The Broader Industry Impact
This practice has created a troubling precedent where:
- Smaller agencies struggle to compete with larger budgets for Premier Agent status
- New agents face an increasingly expensive barrier to entry
- The relationship between agents and their listings has been commoditized
Moving Forward
The industry needs to reconsider its relationship with these platforms. Possible solutions include:
- Modified syndication agreements that protect listing agent leads
- Industry-wide standards for lead attribution
- Greater transparency in lead routing practices
- Support for independent real estate platforms that prioritize agent rights
The real estate community must ask itself: Is the convenience of syndication worth the cost of surrendering control over our own listings? As we continue to feed these platforms with our data, we're essentially funding our own displacement in the digital space.
The time has come for real estate professionals to unite and demand fair practices that respect the work, investment, and relationships that agents build with their listings. After all, a listing isn't just data – it's the result of real work by real professionals who deserve to maintain their connection with potential buyers.
Comments(5)