Would a merger of Trulia and Zillow have an effect on your real estate practice?
- No. (51%, 75 Votes)
- Yes. (49%, 73 Votes)
Total Voters: 148
The multibillion-dollar deal, which first surfaced in July, would see online real estate marketing frontrunner Zillow acquire Trulia, its closest competitor, to create a massively influential real estate tech behemoth. NAR’s version of the online home search, Realtor.com, distantly trails both Zillow and Trulia in both traffic and ad revenue.
According to the Post, the deal has NAR tucking tail and crying monopoly—reportedly asking the FTC to block the deal on antitrust grounds.
That’s an interesting move coming from a one-million member trade association with tentacles reaching into virtually every local real estate market in the United States. As has been shown time and time again, NAR, and its California manifestation CAR, have an aggressive history of trying to control nearly every aspect of the real estate business whenever it can.
NAR’s claim that a merger between the two listing aggregators is anticompetitive is a thinly veiled protestation of the fact it would require NAR to become more competitive with its online offerings. Zillow and Trulia both make money helping agents find clients and market listings—whether they’re independent or trade association members.
Coincidentally, so does Realtor.com—and NAR clearly doesn’t like the idea of competing with their combined forces for that revenue. Who is being anticompetitive here, exactly?
On top of the revenue generated from marketing and advertising with Realtor.com, NAR makes income from their vast network of local and state associations, including member dues and MLS revenues, plus other holdings and operations.
NAR membership is built into every local and state Association of Realtor’s dues schedule and was $155 in 2014. That figure, of course, includes neither the remainder of fees and dues which go to state and local associations, nor the cost of access to forms programs and other “benefits.”
Online listing searches are not the core of NAR’s business, which—judging from their ancillary endeavors—is significantly diversified.
Further, the potential marketplace for online real estate listing and marketing is enormous. As we’ve reported before, Zillow and Trulia’s combined revenues account for just 4% of what agents and brokers spend on marketing annually. As buyers, sellers and agents increasingly gravitate toward the Internet as the primary locus of their real estate activities, there remains a vast amount of business to go around—not just for Zillow, Trulia and Realtor.com, but smaller competitors like Redfin and upstarts like Estately.
The FTC has until September 3rd to decide whether it will pursue the antitrust issue or let the merger move forward. For now, NAR has remained mum on the issue (aside from anonymous leaks to the media)—but the coming weeks will bear out the entity’s true feelings on this competition issue. We don’t expect a warm response.
NAR and CAR are a scam – the entire model is a scam. Local associations are a scam. MLS is the only thing that keeps them afloat. Without it, they would shrivel up and die. The code of ethics is a tired old pitch to keep people thinking there’s something useful in the Realtor brand. Where was the code of ethics during the boom in the early 2000’s? Local associations fleece their members, waste their dues, and most importantly, hold their members hostage with the MLS. Most fools think their listing data is protected by the likes of their local, state and national associations.
Wake up people – if you’ve ever been inside a large local association, you’d realize they operate with the same impunity as a labor union. There is no value in a Realtor or association membership outside of MLS access. And sadly, those same associations are monetizing the listing data and making themselves rich while doing it on the payroll.
The largest association in Southern California is the most corrupt organization in the country yet the average card carrying, code of ethics abiding Realtor is totally clueless to what happens within the organization.
The industry needs a shakeup like this to bring things back in-line. NAR, CAR and the likes have a dirty monopoly, and sadly, 80% of their members are just too ignorant to realize what’s really going on.
I agree with Dan. At one point, I was paying monthly or annual fees to 5-7 different MLS’s ( In a 45 min drive, I would pass through 7 MLS’s fiefdoms. Even though Realtors hate paying the multiple multiple LS fee’s, the fiefdoms refuse to consolidate or reduce fees because they don’t have to. When you have a monopoly there’s no incentive to innovate.
Bell Atlantic and AT&T used to charge 50-70 cents p/min for phone calls until competitors finally gained access to the networks. After 15 years in the business, i haven’t met a single agent who purchased a Realtor Membership for any reason other than being forced to in order to also purchase the desired MLS Membership. (somehow miraculously escaping anti-trust law prohibiting tie-in arrangements)
If Realtor Membership was voluntary (as it is with a few rare MLS’s), the NAR would be forced produce a tangible benefits. Imagine going to your local hamburger joint and being forced to buy a gallon of soda in order to get the burger. The gallon of soda is the same thing as the mandatory Realtor Membership; a large, bloated, expensive, calorie-rich, nutrient-void, bucket of fizz.
NAR’s lofty Code Of Ethic’s (COE) may have been necessary in the 1800’s but now there are comprehensive State laws that agents must comply with. In fact, there is virtually nothing in the COE that isn’t already prohibited by law except for NAR’s anti-solicitation rules and other anti-consumer and pro-MLS rules.
The upside to MLS’s and Realtor Association’s is that they offer great (albeit member-subsidized) job-security!
Maybe the question that NAR should be asking is, should NAR/Realtor.com together with the local associations be cutting off sindication and not allowing listing information from the associations to be filtered through Zillow/Trulia? This way, if a realtor wants to double list with advertised through Z/T, then they would have to pay a double membership. As it is now, realtors are getting basic free advertisement with Z/T through sindication. But if they want it to be more personalized where the buyer and seller is directly connected, then they pay membership dues to Z/T. I believe most realtors do not want or can’t afford to pay double memberships for the same advertisement to get on to Z/T. Consumers need to be educated regarding these types of sites and their unwillingness to have updated information that is in the consumers best interest and that means to advertise it on the front sign in pages of rearch sites as AOL, GOOGLE, YAHOO, HUFFINGTON POST ETC…ETC.. as people sign in to check their emails and blog sites. Consumers do not realize that when they only deal directly with one agent on sites like these, they are not going to be shown all the available listings. Most on the time broker/realtors will only show their own and say that all the others are no longer available to keep the consumer from further research. Consumers need to be educated to make sure to ask their realtors to show other broker/agent listings to ge the best available home of choice. There are too many unethical broker/realtors out their these days not willing to work with others in the best interest of the buyer or seller.
I Strongly Agree with Dan Scott. I too have been a member of NAR since the 80’s. Everything he says about them is True. Their dues have remained the same for many years. They lobby & fight for Property Owners Rights along with Realtors. They take their Code of Ethics Very Seriously and are Always working hard to keep Real Estate viewed as a Respected Profession.
What he says about Zillow & Trulia is also correct. They more often than not have outdated & inaccurate information & they seem to have no interest in the age or accuracy of it. All they are interested in is how much money they can get. If the two of them are allowed to merge, I believe it will be a bad thing for the general public because I’ve never seen a Mega Merger in any field that didn’t Ultimately destroy competition and once thats Gone watch those prices rise.
I’m Very Disappointed with First Tuesday. I’ve been with them for decades but in the last few years I’ve noticed a Distinct bias in their Articles. Why not go back to just reporting the facts without interjecting your negative views. I’m ready to find another company to give my business to.
Jill M’s post, like many others i’ve found on different websites appears to be written by a NAR-employee.
My challenge to you Jill M., is since you claim to have purchased a Realtor Membership for non-compulsory reasons, why not ask your local association or NAR to put out an objective survey asking their members why they purchased memberships?
It is amazing how the ONCE MIGHTY NAR is now crying WOLF! The real issue is will JUSTICE be served on the part of the merger and allow it to go through or with the ANTI -BUSINESS atmosphere of this administration and the fact that the NAR has donated HEAVILY to the DEMOCRATIC PARTY and the fact that the president is PRO anyone that DONATES to his CAUSE, I wonder if Zillow and Trulia will be able to have the fair day in court or will they suddenly be faced with IRS issues for not donating to the DEMOCRATIC PARTY? That is what happened to BILL GATES in 1996 when President Clinton asked for a donation. Bill Gates said no and the next thing he saw was an IRS audit!
We are living in an age of CHRONY CAPITALISM and it will continue for as long as the things remain the way t hey are!
It is interesting that no official comment has been made by NAR, but this article seems to be a bit of an attack on NAR. I have been a member of NAR since 1987 mainly because of the code of ethics required by NAR and because NAR does work to lobby for protection of property owner rights as well as benefits to agents within the real estate business. Those who choose not to join NAR often get the benefits of the lobbying without paying a dime. I am NOT an NAR groupie to be clear.
My concern with Zillow and Trulia is that some of their information online is misinformation…in particular as to property values. The general public sees things online and believes them to be true. As real estate professionals with more local knowledge, we have to unwind the misinformation that the public has gotten. Much of the information that these sites provide regarding actively listed properties comes directly from realtor.com. When there are separate companies to choose from to market properties, it keeps our costs down. Once these giants merge and they control a huge portion of online searches and requests for information, they can jack their prices up especially since they are backed by investors wanting large returns on their investments.
Interestingly, the information available through realtor.com has not increased in costs for us as agents for many years. My MLS dues have not gone up in over 15 years. In fact, they dropped a little and for the last 2 years we have had a free month of dues. Our MLS system polices itself for accuracy, fining agents who do not provide correct information which is part of how our dues have not increased. Accurate information is way more valuable to the general public. Inaccurate information makes our job even harder because people think they know the truth.