Founded by former Microsoft executives and the co-founders of Expedia, online real estate firm Zillow is destined to shake-up the real estate world with its announcement today.
Zillow.com will now allow homeowners and real estate agents to post homes for sale for free. Additionally, in redefining what it means for a house to be “for sale,” Zillow is enabling any homeowner to post a “Make Me Move” price.
Here are the reasons that we think the move by Zillow is significant:
1. Zillow is creating a new home listing service — an alternative to the 100-year-old MLS system. It is, in effect, building its own listing database and can do more or less what it wants with the data collected.
2. Zillow is fast becoming a centralized real estate information and communication hub, the potential centerpiece for the local offline real estate conversation.
3. The Seattle-based firm is offering an amazing mix of user tools — elegant user interface, innovative maps and new Wiki features. Zillow brings some of the best thinking around Web 2.0 applications to tap into the real estate obsession.
4. Zillow is relying on user-generated content in a new but familiar way for agents. Realtors have been uploading their listings to MLS databases for 10 decades. Zillow is allowing homeowners to essentially list their own homes, something they cannot do on the MLS.
5. The way Zillow is getting listings — from agents and consumers — may allow the fast-moving Web firm to sidestep copyright claims and other industry constraints on what and how they use the data and what they do with their business model. Almost all online companies have gone the permission-content route — asking either MLS organizations or brokers for permission to display and publish listings — forcing them to obey industry rules, some of which are rational and others protectionist.
6. The online company is mixing property record data and listing data in a dynamic way. It is using its property record database to establish the baseline for for-sale listings, making it easier and in some cases more accurate.
7. The timing is right. In a slow housing market, agents are scrambling to get more exposure for their listings to appease impatient sellers. Zillow is free. Most agents will jump at the chance or be forced to as more consumers adopt the Zillow platform.
8. Zillow will be the first company to experiment in a serious way with a consumer-direct home-selling model, giving sellers the option to entertain offers directly from prospective buyers.
9. We predict that industry reaction will be loud and strong. We expect a firestorm, though the Justice Department and Federal Trade Commission investigations will prevent the types of reactions that occurred in earlier periods of Internet innovation.
10. The initiative at Zillow will spur many new business models and more capital in online real estate as investors and entrepreneurs follow their lead.