Flex pricing will allow agents to pay only on leads they close in four markets beginning June 4.

After piloting a lead referral platform in which agents pay Zillow a portion of their commission on closed leads as opposed to an upfront market-based price, Zillow is set to test the platform in two markets in Colorado and two in Connecticut on June 4.

In the four markets – New Haven-Milford and Norwich-New London in Connecticut as well as Fort Collins and Pueblo, Colorado – flex pricing will replace the current Premier Agent model, where agents pay up front for a share of leads based on their ZIP code. Zillow declined to share the exact fee but told Inman, “it’s competitive.”

“On June 4, those markets will transition to the flex program, which means that all the PAs and the premier brokers in those markets will be invited to participate in flex and all the leads and connections in those ZIPs are going to flow through flex,” a spokesperson for Zillow told Inman.

In the first iteration of the test, Zillow offered the service to select brokers. In this second iteration, the company wanted to test it out with Premier Agents in markets where they have support nearby, such as in New York and Denver, where Zillow currently has offices.

The spokesperson told Inman they’re going to have teams to support the Premier Agents through the change and will have local presentations to advise agents.

For the first two months, agents will get leads based on their previous share of voice, but after two months that will switch to an algorithm that matches consumers with the agents most likely to close.

“In partnership with real estate professionals, we strive to build the largest, most trusted and vibrant home-related marketplace,” a spokesperson for the company said. “Providing connections at no upfront cost to service-oriented professionals moves us closer to this goal by increasing the likelihood that home shoppers have a great experience each time they connect with an agent through our sites.”

During the initial test phase of the platform, clients of the flex pricing program raised some concern over the level of data-sharing that Zillow was requiring in exchange for participation. Zillow quietly removed those data-sharing requirements from the platform, as Inman previously reported.

The move to further test a referral platform versus traditional lead generation is similar to realtor.com’s moves to replace its traditional lead generation with a referral platform from Opcity.

Email Patrick Kearns

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