Despite Zillow’s insistence that its attempt to get a real estate broker’s license in Arizona won’t change how the company does business and that it has no plans to begin acting as a brokerage, some agents aren’t convinced. 

Despite Zillow’s insistence that its attempt to get a real estate broker’s license in Arizona won’t change how the company does business, and that it has no plans to begin acting as a brokerage, some agents aren’t convinced. 

On Monday, following the news of its acquisition of Mortgage Lenders of America, Zillow told Inman that it would be applying to acquire the license to comply with a requirement from the Arizona Department of Real Estate (ADRE). The ARDE says Zillow needs a license to continue operating Zillow Offers, its direct-to-consumer home buying and selling program, in the state.

Zillow noted to Inman it has obtained broker’s licenses in the past from other states (including one currently active in Texas) and never operated as a traditional brokerage. This is no different, the company said.

After the news broke, dozens of real estate agents publicly expressed doubt that Zillow won’t start acting as a brokerage and cut real estate agents out of Zillow Offers, if it indeed obtains a license.

“If you put on a suit and tell me you aren’t wearing a suit then are you wearing a suit?” Rosemary Phinney Buerger, an associate broker at Coldwell Banker Advantage commented on the Inman Coast to Coast Facebook page. “That’s what it feels like.”

“Lol every time Zillow announces they acquired something and they are not gonna do this or that, 3 months later they are doing just that…. They cry wolf way too often,” Joel Jadofsky of Keller Williams Success Realty commented on the original story.

Some have even suggested cutting off their business to Zillow, or asking others to do so. Yet Zillow’s Premier Agent advertising program makes up the vast majority of the company’s revenue — 71 percent of its total $325.2 million last quarter alone. The program relies on agents paying Zillow to appear in advertisements on listings displayed on its websites. 

“All MLS should cut them off immediately… if not all Realtors should not pay the MLS,” posted Philip Simonetta, business owner at The Simonetta Group Of Charles Rutenberg Realty, in the Inman Coast to Coast Facebook group.

Zillow insisted to Inman that it has no plans to become a brokerage, it has no plans to employ agents, nor to represent buyers and sellers. It just wants to continue operating Zillow Offers the way it has, using local agents to buy and sell properties.

“It’s not going to change anything about the way we operate the Zillow Offers program,” said Errol Samuelson, Zillow’s chief innovation officer. “We’re still going to keep using local agents and brokers representing us as the brokers of record. We’re still going to use our representatives to list our properties.”

“We’re not going to have Zillow employees listing properties, we’re not going to have Zillow employees representing buyers and sellers,” Samuelson added. “This is strictly about getting paperwork in place.”

Others in the real estate community have taken to Facebook to defend Zillow and take the Seattle-based company’s word for it.

“Obtaining a broker license as a requirement by a State and becoming a brokerage are two completely different things,” wrote Mary McKane, managing broker at Levi Rodgers Real Estate Group at Re/Max Military City in Inman Coast to Coast. “Do Great Work and stop fixating on others…”

“Most agents do 4 deals a year,” Andrew Gavin, a broker at Realty National, Inc. posted in Inman Coast to Coast. “The person at their weekly broker meeting sitting next to them is more direct competition than Zillow having a brokers license.”

George Laughton of The Laughton Team, is Zillow’s agent on the ground in Phoenix, representing the company in its buying and selling transactions. He told Inman in a phone conversation that the move isn’t changing his relationship with the company at all. 

“It’s business as usual,” Laughton said.

Laughton told Inman that it seems like the same group of agents that are scared of everything or have their own agendas that are complaining.

“It seems to be the same agents in the forums that I’m on that the sky is falling and scared of all of this change,” said Laughton. “From an agent point of view and my direct interaction, they have no desire to be representing themselves on any of these Zillow Offers properties. We’re still heavily involved in the process.”

Lane Hornung, CEO and founder of 8z Real Estate, will be one of Zillow’s partner agents when it launches Zillow Offers in Denver. He told Inman in a phone conversation that he thinks the attempted acquisition of a broker’s license in Arizona is a “non-event.”

“I would say I wonder if people are kind of confusing business objectives and regulatory requirements,” said Hornung. “I look at it like, they got a regulatory requirement, of course they’re going to comply with it, that would be insane not to comply with a regulatory requirement.”

He even coined a term for the outrage.

“It’s ZDS… Zillow derangement syndrome.”

Email Patrick Kearns

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