Latest news with #Boero
Yahoo
06-08-2025
- Business
- Yahoo
The nightmare scenario for America's real estate market
A few years ago, Brian Boero and his wife decided to buy a vacation home in Tuscany. They envisioned owning an apartment in a medieval Italian city, the ideal splurge for a couple of empty nesters after the height of the pandemic. It was also "kind of a 'YOLO' thing," says Boero, the CEO of 1000Watt, a real estate consulting firm. Once he started hunting for a place, though, his European dream turned into a total nightmare. Shop Top Mortgage Rates Your Path to Homeownership A quicker path to financial freedom Personalized rates in minutes It didn't take long for Boero to realize he'd been spoiled by the American market. That may sound strange given the country's housing woes, but even Americans who've never bought a house have probably enjoyed the quirks that make our setup the envy of the rest of the world. When you want to get a sense of all the homes for sale in your area, you can easily cruise over to Zillow or the website of one of its competitors. The listings on these sites are pulled from industry databases that police their accuracy to ensure you're not wasting time on old or scammy postings. If you like a place, it's pretty easy for your agent to schedule a tour, scoop the keys out of a lockbox, and show you around. The rest of the buying process may come with tears and headaches, but the matter of actually finding homes is fairly seamless. Not so in Europe. The Zillow equivalents there offer only partial views of the market, turning up inaccurate listings or homes that have already traded hands. In particularly maddening cases, the same house may be listed separately by several agents, each of whom is asking for a different price. Brokers are also known to gatekeep their best listings, hiding them from the view of the average buyer. Even aggregate market data is hard to come by since there's no central clearing house for listings — it can be difficult to know whether you're getting a really good deal or a really bad one. In Italy, Boero says, he ended up having to carry out much of his search on foot, hoofing around town to peek at home listings posted in the windows of various brokerages. His real estate agent spent a lot of time on the phone, calling around to see what was available. For Boero, the whole thing felt like "feeling around in the dark." "It was shadowy, confusing," Boero tells me. "We really didn't feel like we were in control of the process." Boero is among those warning that the US market could be headed down a similar path. Some of the country's biggest real estate companies are engaged in a fierce war over the rise of "hidden listings" — homes advertised in some places but purposely kept off other sites. Zillow has gone so far as to ban listings that it says weren't shared with everyone, including Zillow, in a timely manner. Compass, the nation's largest real estate brokerage by sales volume, has responded by suing Zillow in federal court. The feud could result in a fracturing of the housing market, with home listings scattered across the internet or hidden away in so-called "private listing networks." Such a future would have real consequences for American homebuyers, who are used to getting a near-complete view of the market simply by navigating to one of the many home search websites available. There's also a bitter irony at the heart of this fight. Groups of real estate brokers in countries around the world are trying to replicate the US model at the same time that big firms on this side of the pond are squabbling over that very setup. "In France, they're laughing at the situation at this moment, honestly," Ali Attar, a real estate tech executive in Paris, tells me. The system in the US, he says, is more fragile than people realize. "They are taking it for granted in the US," Attar says. "And as soon as they destroy it, bringing it back will be extremely difficult." It took decades for the US to reach this kind of housing market transparency. The crown jewels of our modern real estate model — the things that make everything else possible — are the multiple-listing services, local databases where agents share detailed information on homes for sale. The MLSes then shuttle that info to search portals like Zillow, Redfin, or as well as the websites of thousands of local and national real estate brokerages. The average buyer doesn't get direct access to the MLSes, but with the help of the search portals, they don't really need it. Any home shopper can peruse the market, free of charge, from the comfort of their couch. The MLS model is considered by many to be the gold standard. Brokers in other countries have attempted to form similar databases, but the structure in North America remains unique. The problem isn't a lack of technological know-how — building the machinery isn't hard. The tougher part is getting brokers to agree to this kind of cooperation and enforcing the rules to make sure people don't take advantage of the system. In Europe, sellers are often represented by multiple agents who jockey to be the first to procure a buyer. There's a clear incentive to gatekeep a listing — share it around too much, and another agent might swoop in and broker a deal before you know what hit you. The popular, Zillow-like search portals in places like Spain or France are less unbiased repositories of information and more like advertising platforms. Agents ostensibly pay to display listings, but they're also marketing their own services. If a buyer inquires about a listing that's already sold, no matter — the agent can direct them to the other listings held behind closed doors. This is why listings may remain on these sites long after they've gone off the market. When it comes to drawing in more clients, there's no better lure. The ideal real estate marketplace is full of valuable, visible, and valid listings — what Attar refers to as the "three Vs." Buyers want these listings, they can find them, and the information is correct. House hunters in the US are accustomed to websites with postings that check off all three boxes. But in Europe, Attar says, home listings are typically missing at least one. "If it is valuable and it is valid, it's not visible," Attar tells me. "It's going to be hidden somewhere." Hollin Stafford, a real estate agent with eXp Realty in Portugal, can attest to these frustrations. She spent more than a decade working in the business in the States before moving to a town outside Lisbon in 2016. There she encountered a setup that, in many ways, still feels like "the Wild West," she tells me. Though Stafford has now spent years helping buyers and sellers navigate the Portuguese market through her company, Blue Horizon Properties, she hasn't forgotten the parts of the US system that she once took for granted. "You get so used to having the centralized system where you can see all of the details you need," Stafford says. "You can see what things actually sold for, and do a proper market evaluation, and all these things that you just think are par for the course." In September, real estate leaders from around the world are set to gather in Toronto for the third-annual International MLS Forum, a conference where attendees discuss plans to create the kinds of systems that buyers and sellers in the US already enjoy. Canada is the only other country with anything approaching a similar setup, says Sam DeBord, the CEO of the Real Estate Standards Organization, a nonprofit group focused on developing the technological rules and processes that undergird the MLS databases. Other places, like Egypt and France, have taken steps toward creating comparable databases. But in most cases, those with power — the big brokerages or portals that run things — have little incentive to make a change. "It's this concept of a tragedy of the commons," DeBord tells me. "If every individual goes out and takes as much as they can, all of a sudden the marketplace is ruined." There are some clear signs that the US real estate market could fall into something like the cutthroat, user-unfriendly European model. For one thing, the MLSes are basically a social construct. The National Association of Realtors — one of the most powerful industry groups in the country — effectively sets the rules for participating in these databases, and the local MLSes may levy fines against agents who run afoul of those policies. But there's no law that says it has to work this way, and recent troubles at the NAR have dented the group's influence over other power players. Actual enforcement among local MLSes is also known to be spotty. Some in the industry fear that it could all crumble if all this infighting turns into an actual exodus. Last year, Compass, which has more than 37,000 agents around the country, staked its future on a plan to draw more agents and clients by building up a stockpile of "exclusive inventory": homes that couldn't be found anywhere else. The company began heavily pushing a "three-phased marketing strategy" that encouraged sellers to test their home listings exclusively on the Compass website — first in the company's internal database and then on its public-facing landing page — before sharing them with the MLS and the major search portals. The crux of their pitch was that the MLS and sites like Zillow display information that doesn't help a seller, tracking stuff like price cuts and how long the house has been on the market. The brokerage's marketing plan, on the other hand, lets sellers fine-tune their approach and gather valuable feedback from other agents before making a broader debut. Plenty of industry figures cried foul over this plan — the whole system is predicated on the idea that agents share their listings widely and freely. But the brokerage's play also seemed to be working. Buyers want to get a first glimpse at homes however they can, and sellers may not mind testing the market in a limited capacity if they think it'll net them more in the long run. In February of this year, Compass said that more than half of its sellers were choosing to "premarket" their homes using the three-phased plan. About 94% of Compass's listings last year, including those that went through this kind of premarketing, eventually made it to the MLS, the company says, though it's not clear how long those houses spent in the databases. Even if most of these houses ended up on Zillow and the like, Compass clients still had early access to thousands of listings that couldn't be found on the big search portals. The concern now is that other big brokerages could decide to follow suit, keeping homes on their own websites before sharing them elsewhere. In this state of play, a buyer could still visit a site like Zillow to look at homes for sale, but the portal wouldn't be able to show you all, or maybe even most, of the available listings at any given moment. Instead, you'd have to jump from site to site, scouring the web for homes. The choice of an agent would carry additional weight — you'd have to consider just how much of the market they could unlock via their access to private, internal databases. The closest analogy to this hypothetical may be the fragmented world of video streaming, in which companies like Netflix, Hulu, and HBO Max are racing to build walled gardens of exclusive content. Sure, you can try to get access to all the shows and movies out there, but doing so requires a lot of time and money. And, frankly, it's a huge pain. Mike DelPrete, a real estate tech strategist and scholar-in-residence at the University of Colorado Boulder, has been warning about this threat to the search portals for years. "When it comes to browsing for real estate, consumers want access to all of the available inventory," DelPrete wrote in a blog post four years ago. "If a certain portion of listings are held off-market, available exclusively on another platform, consumer eyeballs will naturally follow." For now, a lot of eyeballs are still on Zillow, which draws more than 220 million unique visitors each month. But that's of little comfort to those who warn that Compass could trigger a domino effect among other large brokerages. The 10 largest brands in real estate accounted for more than half of US home sales volume last year, data from T3 Sixty, a consulting firm for residential real estate brokerages, shows. Even some leaders who have come out against Compass' strategy have warned that they, too, could flex their sizable market share to execute a similar game plan. MLSes need "someone to enforce the rules," DeBord tells me. In this case, that enforcer may turn out to be Zillow. The home search giant has tried to put the kibosh on all of this by banning listings that are not shared with Zillow — and the rest of the MLS — within one business day of being marketed publicly. That means as soon as a "for-sale" sign shows up in the front yard or an agent posts about a house on their website, the clock is ticking for them to send it to the databases that share listings with pretty much every other site in the industry. Those who don't comply will be left to explain to their clients why their house won't appear on the most popular home-search portal in the country. Compass has sued Zillow in federal court, accusing the company of using its monopoly power to quash a competing business model that, Compass claims, gives sellers more control over where and how their homes are marketed. In a formal response last month, Zillow disputed the monopoly characterization and argued that it shouldn't be forced to help Compass freeride on the system by accepting its stale listings only after they haven't sold on the Compass site. The brokerage's three-phased marketing strategy, Zillow's lawyers wrote, "harms consumers, who face balkanized and less liquid markets for homes, and Zillow, whose ability to attract and serve consumers depends on comprehensive, up-to-date listings." It's important to remember that anyone weighing in on this battle has a financial stake in their desired outcome. Compass wants to grow its agent base and market share. Zillow needs fresh home listings to fuel its business, which relies on selling leads to agents who pay to advertise on its platform. American companies aren't the only ones who care about this, either — brokers around the world are watching to see how this shakes out. When I talked to DelPrete back in June, he had just returned from a weekslong work trip to Europe. The fight over inventory back in the States, he says, came up "a surprising amount of times." "I think it's a case of the grass is always greener, right?" DelPrete says. "The US wants what the rest of the world has, and the rest of the world wants what the US has." There's a case to be made that all this hand-wringing will turn out to be hyperbole. The real estate industry in the US is notoriously slow to change, and consumers are used to the current setup. Zillow draws so many visitors that it's hard to imagine real estate agents shunning the platform en masse — it's simply too powerful a marketing machine. The MLS model, at least as it exists in the States, is far from perfect. More than 500 local databases form a complex web of overlapping fiefdoms that agents have to subscribe to individually. The recent class-action lawsuits against the National Association of Realtors and major brokerages cast the MLSes not as models of transparency, but as shadowy databases that helped prop up agent commissions by facilitating a sneaky practice known as "steering." There are other models that could work, too: In Australia, for instance, there's a dominant search portal where most people go to find homes, and many places sell via an auction that offers more transparency than the US system of making blind offers. And while the search portals here offer pretty comprehensive views of the market, they've never had all of the listings. There have always been so-called "pocket listings" that float around beyond the reach of the MLSes, available only to in-the-know agents who can offer their clients a leg up on the competition. But hardly anyone in the industry disagrees with the basic premise that buyers like being able to find homes easily and in one place. People may gripe about Zillow's power in the industry or the questionable accuracy of its ubiquitous Zestimate, but the ability to scroll through all the listings on the site — or those on any of the other search portals — is unique to North America. Few probably appreciate this better than Boero, the real estate exec who set out to buy the Italian getaway of his dreams. He did eventually find a place that checked off his boxes: "We're happy with it," he says. But he made that purchase with far less confidence than he had in any real estate transaction in his life. And even today, he has no idea whether it's worth more or less than it was when he bought it three years ago. The whole experience, he tells me, gave him a new appreciation for the American way of doing things. "Within the industry, we've made these comparisons ad nauseam," Boero tells me. "'Hey guys, let's not destroy this very special thing we have. Because just look at the rest of the world and how messed up it is.'" James Rodriguez is a senior reporter on Business Insider's Discourse team. Read the original article on Business Insider
Business Insider
06-08-2025
- Business
- Business Insider
Adieu, house hunting!
A few years ago, Brian Boero and his wife decided to buy a vacation home in Tuscany. They envisioned owning an apartment in a medieval Italian city, the ideal splurge for a couple of empty nesters after the height of the pandemic. It was also "kind of a 'YOLO' thing," says Boero, the CEO of 1000Watt, a real estate consulting firm. Once he started hunting for a place, though, his European dream turned into a total nightmare. It didn't take long for Boero to realize he'd been spoiled by the American market. That may sound strange given the country's housing woes, but even Americans who've never bought a house have probably enjoyed the quirks that make our setup the envy of the rest of the world. When you want to get a sense of all the homes for sale in your area, you can easily cruise over to Zillow or the website of one of its competitors. The listings on these sites are pulled from industry databases that police their accuracy to ensure you're not wasting time on old or scammy postings. If you like a place, it's pretty easy for your agent to schedule a tour, scoop the keys out of a lockbox, and show you around. The rest of the buying process may come with tears and headaches, but the matter of actually finding homes is fairly seamless. Not so in Europe. The Zillow equivalents there offer only partial views of the market, turning up inaccurate listings or homes that have already traded hands. In particularly maddening cases, the same house may be listed separately by several agents, each of whom is asking for a different price. Brokers are also known to gatekeep their best listings, hiding them from the view of the average buyer. Even aggregate market data is hard to come by since there's no central clearing house for listings — it can be difficult to know whether you're getting a really good deal or a really bad one. In Italy, Boero says, he ended up having to carry out much of his search on foot, hoofing around town to peek at home listings posted in the windows of various brokerages. His real estate agent spent a lot of time on the phone, calling around to see what was available. For Boero, the whole thing felt like "feeling around in the dark." "It was shadowy, confusing," Boero tells me. "We really didn't feel like we were in control of the process." Boero is among those warning that the US market could be headed down a similar path. Some of the country's biggest real estate companies are engaged in a fierce war over the rise of " hidden listings" — homes advertised in some places but purposely kept off other sites. Zillow has gone so far as to ban listings that it says weren't shared with everyone, including Zillow, in a timely manner. Compass, the nation's largest real estate brokerage by sales volume, has responded by suing Zillow in federal court. The feud could result in a fracturing of the housing market, with home listings scattered across the internet or hidden away in so-called "private listing networks." Such a future would have real consequences for American homebuyers, who are used to getting a near-complete view of the market simply by navigating to one of the many home search websites available. There's also a bitter irony at the heart of this fight. Groups of real estate brokers in countries around the world are trying to replicate the US model at the same time that big firms on this side of the pond are squabbling over that very setup. "In France, they're laughing at the situation at this moment, honestly," Ali Attar, a real estate tech executive in Paris, tells me. The system in the US, he says, is more fragile than people realize. "They are taking it for granted in the US," Attar says. "And as soon as they destroy it, bringing it back will be extremely difficult." It took decades for the US to reach this kind of housing market transparency. The crown jewels of our modern real estate model — the things that make everything else possible — are the multiple-listing services, local databases where agents share detailed information on homes for sale. The MLSes then shuttle that info to search portals like Zillow, Redfin, or as well as the websites of thousands of local and national real estate brokerages. The average buyer doesn't get direct access to the MLSes, but with the help of the search portals, they don't really need it. Any home shopper can peruse the market, free of charge, from the comfort of their couch. They are taking it for granted in the US. And as soon as they destroy it, bringing it back will be extremely difficult. Ali Attar, cofounder and CEO of Realtyna The MLS model is considered by many to be the gold standard. Brokers in other countries have attempted to form similar databases, but the structure in North America remains unique. The problem isn't a lack of technological know-how — building the machinery isn't hard. The tougher part is getting brokers to agree to this kind of cooperation and enforcing the rules to make sure people don't take advantage of the system. In Europe, sellers are often represented by multiple agents who jockey to be the first to procure a buyer. There's a clear incentive to gatekeep a listing — share it around too much, and another agent might swoop in and broker a deal before you know what hit you. The popular, Zillow-like search portals in places like Spain or France are less unbiased repositories of information and more like advertising platforms. Agents ostensibly pay to display listings, but they're also marketing their own services. If a buyer inquires about a listing that's already sold, no matter — the agent can direct them to the other listings held behind closed doors. This is why listings may remain on these sites long after they've gone off the market. When it comes to drawing in more clients, there's no better lure. The ideal real estate marketplace is full of valuable, visible, and valid listings — what Attar refers to as the "three Vs." Buyers want these listings, they can find them, and the information is correct. House hunters in the US are accustomed to websites with postings that check off all three boxes. But in Europe, Attar says, home listings are typically missing at least one. "If it is valuable and it is valid, it's not visible," Attar tells me. "It's going to be hidden somewhere." Hollin Stafford, a real estate agent with eXp Realty in Portugal, can attest to these frustrations. She spent more than a decade working in the business in the States before moving to a town outside Lisbon in 2016. There she encountered a setup that, in many ways, still feels like "the Wild West," she tells me. Though Stafford has now spent years helping buyers and sellers navigate the Portuguese market through her company, Blue Horizon Properties, she hasn't forgotten the parts of the US system that she once took for granted. "You get so used to having the centralized system where you can see all of the details you need," Stafford says. "You can see what things actually sold for, and do a proper market evaluation, and all these things that you just think are par for the course." In September, real estate leaders from around the world are set to gather in Toronto for the third-annual International MLS Forum, a conference where attendees discuss plans to create the kinds of systems that buyers and sellers in the US already enjoy. Canada is the only other country with anything approaching a similar setup, says Sam DeBord, the CEO of the Real Estate Standards Organization, a nonprofit group focused on developing the technological rules and processes that undergird the MLS databases. Other places, like Egypt and France, have taken steps toward creating comparable databases. But in most cases, those with power — the big brokerages or portals that run things — have little incentive to make a change. "It's this concept of a tragedy of the commons," DeBord tells me. "If every individual goes out and takes as much as they can, all of a sudden the marketplace is ruined." There are some clear signs that the US real estate market could fall into something like the cutthroat, user-unfriendly European model. For one thing, the MLSes are basically a social construct. The National Association of Realtors — one of the most powerful industry groups in the country — effectively sets the rules for participating in these databases, and the local MLSes may levy fines against agents who run afoul of those policies. But there's no law that says it has to work this way, and recent troubles at the NAR have dented the group's influence over other power players. Actual enforcement among local MLSes is also known to be spotty. Some in the industry fear that it could all crumble if all this infighting turns into an actual exodus. Last year, Compass, which has more than 37,000 agents around the country, staked its future on a plan to draw more agents and clients by building up a stockpile of "exclusive inventory": homes that couldn't be found anywhere else. The company began heavily pushing a "three-phased marketing strategy" that encouraged sellers to test their home listings exclusively on the Compass website — first in the company's internal database and then on its public-facing landing page — before sharing them with the MLS and the major search portals. The crux of their pitch was that the MLS and sites like Zillow display information that doesn't help a seller, tracking stuff like price cuts and how long the house has been on the market. The brokerage's marketing plan, on the other hand, lets sellers fine-tune their approach and gather valuable feedback from other agents before making a broader debut. Plenty of industry figures cried foul over this plan — the whole system is predicated on the idea that agents share their listings widely and freely. But the brokerage's play also seemed to be working. Buyers want to get a first glimpse at homes however they can, and sellers may not mind testing the market in a limited capacity if they think it'll net them more in the long run. In February of this year, Compass said that more than half of its sellers were choosing to "premarket" their homes using the three-phased plan. About 94% of Compass's listings last year, including those that went through this kind of premarketing, eventually made it to the MLS, the company says, though it's not clear how long those houses spent in the databases. Even if most of these houses ended up on Zillow and the like, Compass clients still had early access to thousands of listings that couldn't be found on the big search portals. The concern now is that other big brokerages could decide to follow suit, keeping homes on their own websites before sharing them elsewhere. In this state of play, a buyer could still visit a site like Zillow to look at homes for sale, but the portal wouldn't be able to show you all, or maybe even most, of the available listings at any given moment. Instead, you'd have to jump from site to site, scouring the web for homes. The choice of an agent would carry additional weight — you'd have to consider just how much of the market they could unlock via their access to private, internal databases. The closest analogy to this hypothetical may be the fragmented world of video streaming, in which companies like Netflix, Hulu, and HBO Max are racing to build walled gardens of exclusive content. Sure, you can try to get access to all the shows and movies out there, but doing so requires a lot of time and money. And, frankly, it's a huge pain. Mike DelPrete, a real estate tech strategist and scholar-in-residence at the University of Colorado Boulder, has been warning about this threat to the search portals for years. "When it comes to browsing for real estate, consumers want access to all of the available inventory," DelPrete wrote in a blog post four years ago. "If a certain portion of listings are held off-market, available exclusively on another platform, consumer eyeballs will naturally follow." For now, a lot of eyeballs are still on Zillow, which draws more than 220 million unique visitors each month. But that's of little comfort to those who warn that Compass could trigger a domino effect among other large brokerages. The 10 largest brands in real estate accounted for more than half of US home sales volume last year, data from T3 Sixty, a consulting firm for residential real estate brokerages, shows. Even some leaders who have come out against Compass' strategy have warned that they, too, could flex their sizable market share to execute a similar game plan. MLSes need "someone to enforce the rules," DeBord tells me. In this case, that enforcer may turn out to be Zillow. The home search giant has tried to put the kibosh on all of this by banning listings that are not shared with Zillow — and the rest of the MLS — within one business day of being marketed publicly. That means as soon as a "for-sale" sign shows up in the front yard or an agent posts about a house on their website, the clock is ticking for them to send it to the databases that share listings with pretty much every other site in the industry. Those who don't comply will be left to explain to their clients why their house won't appear on the most popular home-search portal in the country. I think it's a case of the grass is always greener, right? The US wants what the rest of the world has, and the rest of the world wants what the US has. Mike DelPrete, real estate tech strategist and scholar-in-residence at the University of Colorado Boulder Compass has sued Zillow in federal court, accusing the company of using its monopoly power to quash a competing business model that, Compass claims, gives sellers more control over where and how their homes are marketed. In a formal response last month, Zillow disputed the monopoly characterization and argued that it shouldn't be forced to help Compass freeride on the system by accepting its stale listings only after they haven't sold on the Compass site. The brokerage's three-phased marketing strategy, Zillow's lawyers wrote, "harms consumers, who face balkanized and less liquid markets for homes, and Zillow, whose ability to attract and serve consumers depends on comprehensive, up-to-date listings." It's important to remember that anyone weighing in on this battle has a financial stake in their desired outcome. Compass wants to grow its agent base and market share. Zillow needs fresh home listings to fuel its business, which relies on selling leads to agents who pay to advertise on its platform. American companies aren't the only ones who care about this, either — brokers around the world are watching to see how this shakes out. When I talked to DelPrete back in June, he had just returned from a weekslong work trip to Europe. The fight over inventory back in the States, he says, came up "a surprising amount of times." "I think it's a case of the grass is always greener, right?" DelPrete says. "The US wants what the rest of the world has, and the rest of the world wants what the US has." There's a case to be made that all this hand-wringing will turn out to be hyperbole. The real estate industry in the US is notoriously slow to change, and consumers are used to the current setup. Zillow draws so many visitors that it's hard to imagine real estate agents shunning the platform en masse — it's simply too powerful a marketing machine. The MLS model, at least as it exists in the States, is far from perfect. More than 500 local databases form a complex web of overlapping fiefdoms that agents have to subscribe to individually. The recent class-action lawsuits against the National Association of Realtors and major brokerages cast the MLSes not as models of transparency, but as shadowy databases that helped prop up agent commissions by facilitating a sneaky practice known as "steering." There are other models that could work, too: In Australia, for instance, there's a dominant search portal where most people go to find homes, and many places sell via an auction that offers more transparency than the US system of making blind offers. And while the search portals here offer pretty comprehensive views of the market, they've never had all of the listings. There have always been so-called "pocket listings" that float around beyond the reach of the MLSes, available only to in-the-know agents who can offer their clients a leg up on the competition. But hardly anyone in the industry disagrees with the basic premise that buyers like being able to find homes easily and in one place. People may gripe about Zillow's power in the industry or the questionable accuracy of its ubiquitous Zestimate, but the ability to scroll through all the listings on the site — or those on any of the other search portals — is unique to North America. Few probably appreciate this better than Boero, the real estate exec who set out to buy the Italian getaway of his dreams. He did eventually find a place that checked off his boxes: "We're happy with it," he says. But he made that purchase with far less confidence than he had in any real estate transaction in his life. And even today, he has no idea whether it's worth more or less than it was when he bought it three years ago. The whole experience, he tells me, gave him a new appreciation for the American way of doing things. "Within the industry, we've made these comparisons ad nauseam," Boero tells me. "'Hey guys, let's not destroy this very special thing we have. Because just look at the rest of the world and how messed up it is.'"
Miami Herald
19-06-2025
- Business
- Miami Herald
Zillow says it's fighting for buyers. Compass says it's fighting for sellers. What if neither is fighting for you?
As two real estate giants escalate a war over how homes should be listed for sale online, both sides say they're acting in the interest of consumers. Both sides also stand to make a lot of money if they win. The issue intensified at the end of 2024, when Compass, the country's largest brokerage by sales volume, began advising its sellers to use a three-phased marketing approach - making their homes visible only to Compass agents and clients as a "private" listing, making them viewable only via and reserving the option to later make them public on popular house-hunting sites like Redfin and Zillow. In the real estate industry, listings are currency. Faced with thousands of them disappearing from its site, Zillow punched back. The Seattle-based company, starting at the end of June, plans to block any former private listings from appearing on its site - an ultimatum it hopes brings an end to Compass's practice of selectively sharing listings before they appear on big search portals. Redfin will follow with a similar ban in September. Each of these players pitches itself as a pro-consumer brand. Compass says its selective marketing approach offers sellers privacy and control. Some sellers want to market to more exclusive groups before their home appears on big listing sites, which feature details like days on market and price cuts, which can signal a seller is willing to negotiate on price. Zillow and Redfin say they are for transparency in the market, which is good for both homebuyers and sellers. The only way to know a home's true price, they argue, is to advertise it as broadly as possible. But Brian Boero, chief executive of 1000watt, a marketing agency for residential real estate companies, says their pro-consumer stances are largely just messaging. "These companies are using the consumer as almost like a human shield here to protect their business interests," Boero said. "They may believe these things sincerely, but this is first and foremost about rational self-interest." Should Compass win the private listings war, it would upend the paradigm in home listings that buyers have grown used to over the last two decades. When Zillow and Redfin arrived in the mid-2000s, they promised to democratize the home search, pulling back the curtain on a market once controlled by agents and the local databases they operated called multiple listing services. For buyers, the experience changed overnight: Homes that were once buried in classified ads or hidden in books that could only be viewed alongside a broker were suddenly just a click away. Sellers' agents at first rejoiced - they didn't have to work as hard to advertise their properties, and listing on the sites was free. But someone was paying: buyers' agents. When a prospective buyer clicks a listing's "Contact an Agent" button, Zillow or Redfin sells that inquiry to a paying agent. They also take as much as 40% of the agent's commission if they close the sale. Brokerages like Compass have long bristled at the steep fee. But as home sales drag for a third straight year, Compass is trying to change the game. By publishing listings exclusively on it cuts out the referral middlemen. "Organized real estate has been implementing rules that have been stripping homeowners and their agents of flexibility and choice," Rory Golod, president of Growth and Communications at Compass, said in an interview. "They are trying to monopolize where inventory goes and how people sell." Redfin and Zillow, of course, have their own interests to protect - as well as the model that's come to shape the modern home-buying experience. "This isn't just about Zillow or Redfin - the internet has changed home search for the better, where every buyer can have access to all of the inventory," said Joe Rath, Redfin's head of industry relations. "Gatekeeping in any form is antithetical to the internet." Matt Kreamer, Zillow's spokesperson, said that transparency is core to Zillow's philosophy: "We believe that home listings that are available to some buyers should be available to all buyers," he said. Their calls for openness also happen to preserve their business: more listings, more traffic, more fees. Ultimately, Boero, the marketing chief, believes that Zillow's market power will force Compass to blink. "Zillow is the most powerful brand in the history of housing," Boero said. "You just can't imagine not having your home on Zillow as a home seller - it sounds like a stupid thing to have happen." But others see an opportunity for Compass to prevail in bringing traffic directly to its site. "Southwest Airlines didn't sell tickets on any of the online aggregators for years, and they're doing great," said Mike DelPrete, a real estate tech consultant. "People look at multiple sources." The dispute appears to be heading toward a compromise that would allow both Compass and the listing aggregators to uphold their business models, rather than a solution centered around buyers and sellers. Redfin's Joe Rath said his company would be open to hiding certain data, like days on market and price drops, if that's what it took to keep listings public. "We would much rather give ground there and have the listing," he said, "than not have the listing at all." Because all of these companies are paid a percentage of a home's ultimate sales price, it benefits both the brokerages and the search portals to keep buyers in the dark about details that might lead to a lower price. The battle over transparency, it seems, has limits. Whether Compass or the search portals win, both victories would also preserve an as-yet unshakable status quo in real estate: a 2% to 3% commission for buyers' agents. A landmark legal settlement earlier this year threatened that fee structure paradigm - but so far, traditional models have held, although a few flat-fee agencies have broken the mold. So why are the rules governing home listings decided by two major corporations that stand to benefit from pushing prices as high as possible? "With how important housing is to our economy, society and individuals, there is a question of why the information about homes for sale isn't federally regulated," Boero said. But government intervention in home sales isn't likely to happen at the federal level under President Donald Trump, who has promoted deregulation and free markets. The state's regulator, the California Department of Real Estate, lacks the legal authority to make a ruling on private listings that would tip the scales toward either Compass or Zillow. But it can, for example, require agents to give sellers adequate warning on the financial consequences of not appearing on the major home listing sites, said Summer Goralik, a former investigator with the department who now works as a compliance consultant to brokerages. "They'll need to explore whether brokers are breaching fiduciary duty to sellers," Goralik said. "Are they giving all of the information that seller needs to make an informed decision about listing privately?" For her part, Goralik doesn't believe the push for private sales and putting listings back into the brokerages' hands helps buyers or sellers. "A wide-scale campaign for private listings seems to do more harm than good," she said. "It seems like we'd be going back in time. I'm for the future." Copyright (C) 2025, Tribune Content Agency, LLC. Portions copyrighted by the respective providers.
