A legal settlement that strengthened the ability of real estate brokers to provide expanded property listings information through "Virtual Office Web sites" will help Redfin expand into new markets by partnering with other agents, the company claims.
Redfin is now divulging details about listings previously accessible only to real estate agents — including a property’s cumulative days on market, and asking price history — to members of the public who register to use the company’s Web site.
The richer data set for listings in some markets is the latest repercussion of a settlement the Justice Department reached with the National Association of Realtors last year over NAR’s policies governing the online sharing and display of property listings.
The settlement required NAR to adopt a policy allowing member brokers, like Redfin, that participate in multiple listings services (MLSs) to operate "Virtual Office Web sites," or VOWs, and provide a broader range of property information than typically found on public-facing MLS sites (see story).
Other brokers, including ZipRealty, have been offering registered users expanded VOW listing data for some time. But the settlement prohibits those brokers who don’t like the idea from "opting out" of sharing listings information with VOW sites, ensuring the availability of that information in all markets.
Redfin’s business model is based on providing commission refunds to consumers who do some of their own legwork in finding a house online. The company says the settlement will allow it to expand into new markets using a new "partner-aided" strategy in which it offers service from its own agents and partner agents.
The Seattle, Wash.-based online broker said it will serve the Long Island and Westchester County, N.Y., markets, and parts of California’s Central Valley including Sacramento, extending its listings reach by nearly 20 percent.
It’s the first time Redfin has moved into a new market since last summer, and the company says it plans to add three additional markets in 2009, bringing the total number of markets served to 13.
With the goal of entering every major U.S. market, Redfin is employing a new "partner-aided" strategy in which it offers service from its own agents and through partner agents.
Redfin agents will conduct property tours and handle escrow, refunding up to 50 percent of their commissions to clients, the company said. Partner agents will work one-on-one with clients and refund 15 percent of their commissions.
"We used to evaluate new markets in terms of what the local listing service would let us publish, and the ground our own agents had to cover," Redfin CEO Glenn Kelman said in a press release. "Now that the settlement is in effect and our partners can help us in outlying areas … we expect to expand quickly." …CONTINUED
The settlement means VOWs can provide any non-confidential information about a listing to consumers online — including details real estate agents typically provided in person or by e-mail, such as days on market, tax information, sold history and price changes. If there’s a catch, it’s that under the terms of the settlement, consumers must register at VOW sites in order to gain access to the more extensive set of information.
The purpose of requiring consumers to register is to prevent "data scraping" by third-party Web site operators by limiting access to VOWs to consumers who are interested in purchasing a home. But it’s also an opportunity for operators of VOW sites to generate "leads," or information on prospective clients, such as their e-mail address and viewing habits.
Consumers visiting Redfin.com can still see the many details about a listing previously available without registering. Where additional VOW data is available, Redfin prompts them to register or sign in to see it.
"The local MLS requires that we register you before displaying all available listing information," Redfin.com users are informed. "Registering does not require you to work with us and we promise not to spam you, ever."
The deadline for compliance with the settlement was Feb. 15, and Redfin says it intends to publish all the information that becomes available as MLSs update their systems to comply with the new rules.
Redfin says its added more than 200 data fields to its listing database, including data about a seller’s mortgage. The company says the changes amount to a new version of its Web site.
In volatile markets where owners may pull properties that don’t sell off the market and relist them, the VOW data can prove useful to homebuyers.
Only registered users with access to VOW data, for example, see a complete property history for a condo in Oakland, Calif., that came on the market on Feb. 11 for $269,000. The complete property history for the property — visible only after signing in as a registered user — reveals it had previously been listed and delisted three times in the last year.
The property’s previous listing prices are not disclosed, however — even to registered users — because, users of the site are told, the local MLS prohibits the disclosure of prices from inactive listings.
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