Real Estate 2.0 has a great post about Trulia being a pimp, which is true, but they certainly aren’t the only pimp walking the real estate streets.
And, I’ll tell you what- a pimp is not a pimp unless they have “employees”, people who are willing to pay them even though they are the ones doing all the… (ahem)… work.
Sites like HouseValues and RealEstate.com and AgentConnect take Realtor-driven (MLS) info and then sell leads back to the agents. And the agents buy it all up as fast as they can. It’s stupid because they’re cannabilizing their own industry. Instead of paying $1000/month to HouseValues why not spend that money building your own site and getting your own leads?
HouseValues figured out a long time ago that agents in general are slow adopters to technology, so they took advantage of it. I remember when the MLS went online and the agents were freaking out because they thought it would be the end of the industry and the information would be stolen and the technology would break down and no one would be able to access it.
When fax machines came out many agents actually petitioned against them for the same reasons. And with the advent of lead-generation sites, the real estate industry has not protected itself and its interests by shunning them and beating them at their own game, but rather by paying into them and creating a zero-sum gain for the industry.
Follow me on this- here’s how it looks now:
Brokers/agents take listings
Lead-gen sites use listing data to get leads
Lead-gen site sell leads to brokers/agents
Lead/gen site makes lots of money to buy more ads
Lead/gen sites get more leads
Brokers/agents become dependant on lead-gen sites for leads
Lead-gen sites charge more for leads
It could look like this:
Brokers/agents get listings
Lead-gen sites go out of business because nobody pays them
Brokers/agents get all their own leads
Brokers/agents make more money
And I agree with RE 2.0 that Trulia looks good while they are free, but once brokers/agents are dependant and need them because they have grown big and maybe even relevant… will they still be free? I mean, is Trulia a non-profit that just really wants to help agents?
“Coming Soon! Offer optional enhanced/branded listing features and performance-based text advertising to create additional exposure for your listing information with home buyers and sellers”
So once their website becomes cluttered with listing ads, the way Realtor.com has, will the next step be to limit vital information about listings unless the listing agents pay, the way Realtor.com does?
Remains to be seen. What is certain is that so far the score is lopsided in favor of lead-generation sites. And that includes Realtor.com… but that’s for another post.