CoStar Group Acquires Houses.com Domain Name13925
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 Houses.com --- With the acquisition of the Houses.com domain name, CoStar Group sets the stage for its entry into residential real estate with plans to develop a vibrant national marketplace for agents and owners to successfully sell homes without disenfranchising or disintermediating valuable real estate agents in the process. - Houses.com -- Media Release --- WASHINGTON--(BUSINESS WIRE 18 December 2020)--CoStar Group, the leading provider of commercial real estate information, analytics and online marketplaces, today announced its acquisition of Houses.com, setting the stage for its entry into residential real estate marketplaces. On December 16, 2020, the Federal Trade Commission cleared CoStar Group’s acquisition of Homesnap, Inc., which provides real estate brokers with a mobile platform and other technology for managing and analyzing their listings and the housing market. CoStar Group has been successful for many years running marketplace verticals in the commercial real estate space with Loopnet.com, Cityfeet.com and Showcase.com; the multifamily space with Apartments.com, ForRent.com, ApartmentFinder.com, ApartmentHomeLiving.com and Apartamentos.com; the land space with Land.com, LandsofAmerica.com, LandWatch.com and LandandFarm.com; and the businesses for sale space with BizBuySell.com and BizQuest.com. With the acquisition of the Houses.com domain name, CoStar Group plans to develop a vibrant national marketplace for agents and owners to successfully sell homes without disenfranchising or disintermediating valuable real estate agents in the process. About CoStar Group, Inc. CoStar Group, Inc. (NASDAQ: CSGP) is the leading provider of commercial real estate information, analytics and online marketplaces. Founded in 1987, CoStar conducts expansive, ongoing research to produce and maintain the largest and most comprehensive database of commercial real estate information. Our suite of online services enables clients to analyze, interpret and gain unmatched insight on commercial property values, market conditions and current availabilities. STR provides premium data benchmarking, analytics and marketplace insights for the global hospitality sector. Ten-X provides a leading platform for conducting commercial real estate online auctions and negotiated bids. LoopNet is the most heavily trafficked commercial real estate marketplace online with over 7 million monthly unique visitors. Realla is the UK’s most comprehensive commercial property digital marketplace. Apartments.com, ApartmentFinder.com, ForRent.com, ApartmentHomeLiving.com, Westside Rentals, AFTER55.com, CorporateHousing.com, ForRentUniversity.com and Apartamentos.com form the premier online apartment resource for renters seeking great apartment homes and provide property managers and owners a proven platform for marketing their properties. CoStar Group’s websites attracted an average of approximately 69 million unique monthly visitors in aggregate in the third quarter of 2020. Headquartered in Washington, DC, CoStar Group maintains offices throughout the U.S. and in Europe, Canada and Asia with a staff of over 4,300 worldwide, including the industry’s largest professional research organization. For more information, visit www.costargroup.com. Source: CoStar Group via BusinessWire |
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denlee private msg quote post Address this user | |
| Zillow is about to get its butt kicked! | ||
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WGAN Forum Founder & WGAN-TV Podcast Host Atlanta, Georgia |
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Quote:Originally Posted by @denlee Can you expand on why? Dan |
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Deano private msg quote post Address this user | |
| I can't speak to Denlee's reasoning, but on a whole, agents don't like Zillow. It is clear that Costar is trying to court agents. If they can do that along with spending money to acquire internet properties like 'houses.com' and build a good consumer brand around them, it's possible they will give them quite a run for their money. They clearly have the desire to compete and the money to elevate a competing brand. Outside of Zillow's vast name recognition, what is their moat to prevent competition? | ||
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Quote:Originally Posted by @Deano @Deano Will CoStar differentiate Houses.com by making it super-easy for agents to include Matterport in particular and virtual tours in general? I recall Apartments.com (owned by CoStar) using 31,000 Matterport tours as of September 2015: ✓ Apartments.com + Matterport =31,000 3D Tours Dan |
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Deano private msg quote post Address this user | |
| That's a great idea! I think they should. IMO, virtual tours are the #1 way to help buyers really experience homes. I think good Photos are easier to catch buyers attention, but for me, once it is something I think I would like, the next step is to understand the floorplan and flow. A tour is so much better than taking time to visit a property, etc. Great photos and a beautiful 3d tour should be in every agents property marketing budget IMO. Video is nice, but it's primary purpose is to make sellers believe that the agent is doing something (production value) and for buyers once they have made their mind up that they want it - it's the best media to share with friends and family. Just my opinion! |
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Deano private msg quote post Address this user | |
| Actually, they are spending so much $$$, they should just buy Matterport... | ||
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| @Deano Let's hope that CoStar goes BIG with 24/7 Open House Virtual Tours. Also ... Inman (5 January 2021) CoStar Group buys houses.com URL "[CoStar Group founder and CEO Andy] Florance hasn’t been shy about his ambitions to move into the residential real estate space and take on industry giant Zillow. [CoStar acquired] Homesnap is even reportedly working along with the Real Estate Board of New York to create an alternative to the Zillow-owned StreetEasy portal in New York City," reports Inman. Inman (17 December 2020) After CoStar acquisition, Homesnap vows loyalty to Broker Public Portal Dan |
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Quote:Originally Posted by @Deano I recall that Realtor.com's parent company, News Corp., is an investor in Matterport. I wonder if that makes Zillow and now Houses.com reluctant to prominently feature Matterport tours. (This likely explains why Matterport seamlessly integrates with Realtor.com.) Dan |
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denlee private msg quote post Address this user | |
| Sorry for the slow reply Dan. Here's my two cents worth: (it’s long, but there are multiple considerations here). Unlike what CoStar has already successfully achieved in commercial real estate online advertising through Loopnet, Zillow has (in the last two years in particular) under the leadership of Rich Barton, gone out of its way to antagonize residential REALTORS, who have always been their greatest source of gross profit. For years prior to that, former Zillow CEO Spencer Rascoff proclaimed loudly and often that Zillow had no interest in being involved in the real estate transaction. He would say “we just sell adverting, we have no interest in competing with REALTORS”. From Zillow's inception in 2006, it was irritating to many listing REALTORS that it was receiving MLS data free of charge, repackaging it, and selling buyer leads either back to the listing REALTOR or any other REALTOR if the listing REALTOR refused to pay them. Many REALTORS, including my wife, who is a Broker, always felt that this was bad for both the listing REALTORS and consumers. Because the majority of Zillow buyer leads are purchased by someone other than the listing REALTOR, Zillow knowingly connects the consumer with a REALTOR who has most times never been inside the listing in question, and who unlike the listing REALTOR may know little to nothing about the neighborhood, schools, etc. In fact, a savvy buyer who has carefully absorbed all the information contained in the Zillow listing usually knows more about the property than the 'so-called' expert that Zillow has sold their contact information to. Most buyers are surprised and often irritated when they get called by some random REALTOR, because they assume they will be called by the listing REALTOR, who knows the property well. To add insult to injury, Zillow subsequently got into the real estate transaction (despite their prior assurances to the contrary) with their ‘ibuyer’ program, which is just a euphemism for house flipping. The final straw was their recent announcement that they're becoming real estate brokers, in direct competition with the 1.4 million REALTORS who have collectively been sending them over a billion dollars a year for predominately worthless buyer leads (my wife used to purchase them). Another reason that many REALTORS are suspicious of Zillow is because they own dotloop, and consequently they store the confidential client information of many REALTORS on their servers. Conversely, CoStar’s Loopnet charges a fee to commercial listing brokers to place their listing on Loopnet, and in return it places ONLY the listing broker’s contact information with the listing. Some brokers think they charge too much, but it’s a choice – you don’t have to place your listing with them. Assuming CoStar continues with the same listing broker centric approach with their foray into residential real estate (they’d be crazy if they didn’t), many brokers, including my wife will be interested in paying to advertise listings with them, provided their reach and the fees they charge make business sense. |
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| @denlee Thank you for the detailed backstory. Quote: Originally Posted by @denlee Yes. This does seem crazy. Seems like the following makes more "cents" ... Quote: Originally Posted by @denlee Seems like Zillow having a worthy competitor will be great for all stakeholders: including real estate photographers! Happy New Year, Dan |
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denlee private msg quote post Address this user | |
| I agree Dan. Some serious competition from CoStar will hopefully force Zillow to cease or modify some of its practices. For example, take a look at the attached screenshot taken from Zillow today. The listing REALTOR happens to be my wife Leah. Above her photo and name is a big bold blue bar which states 'CONTACT AGENT'. EVERY person that I've ever shown one of her listings on Zillow to and asked "if you click CONTACT AGENT and give up your name, email address and phone number, who do you think that information is sent to? Without exception, every person said "that would be sent to Leah (the listing REALTOR), of course" - WRONG! It's sent to three other REALTORS, who typically have zero knowledge of the listing, but who pay Zillow for leads off Leah's listings!  It's also worth noting that unlike Zillow with their fake 3D tour (it's only a 360 tour) through their proprietary App, CoStar on Loopnet allows any URL to be featured on a listing. Forum members should also be aware that the 'View Virtual Tour' link shown in the top left of the picture will be automatically removed by Zillow if the listing REALTOR adds a tour from the Zillow App. I learned this the hard way. The link to our Matterport tour vanished, and it took me several days to realize that happened after I added a Zillow tour. As soon as I removed the Zillow tour, the link to our Matterport tour (which is pulled from the virtual tour field in the MLS) reappeared. |
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Deano private msg quote post Address this user | |
| My wife is also a broker and I 100% agree Denlee, nice explanation. I think everyone in the industry is pulling for Costar to give Zillow a run for their money on this one. The one downside I see is that like a cornered animal, if Costars successful courts the industry and Zillow starts to lose revenue it might force them to execute 'order 66'. It's no surprise that they have the ability to further marginalize an agent's role in the value chain. Their modelling of the entire process flow and recent brokerage status might cause them to formally announce a low cost model to compete with brokers at scale and scrap cooperation/leads at all. Next step would be reducing our wives to the obligatory text line at the bottom of the listing... This is all speculation of course, but with the amount of money they have and the smart people that they have working for them combined with a ridiculously inefficient model that currently exists, it's not an outlandish thought. |
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Quote:Originally Posted by denlee That's astonishing!!! (!!!) I thought it went to the listing agent. AMAZING!!! Dan |
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Deano private msg quote post Address this user | |
| Dan, at one point a listing agent could pay $200 per month and all inquiries on all of their listings DID go to the listing agent. Zillow got rid of that service as it is far more profitable to charge 35% referral fee from giving it to a unassociated buyers agent. Zillows revenue increased from $200 per month to $5-7k per transaction. By taking such a large part of the monetization, it just keeps costs high for consumers. Losers: listing agents and consumers Winners: Zillow shareholders Nice conversation, gentlemen! |
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| @Deano What is "order 66"? It's since to have Members that have spouses that are agents to help the Community understand the big picture and give us context for the CoStart (Houses.com) news. @Deano and @denlee If you have additional thoughts on this topic, please do share. Thank you! Dan |
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Deano private msg quote post Address this user | |
| Sorry, I'm a star wars nerd and order 66 was the order that the bad guys gave to have the Jedi's eliminated. Bad joke but it seemed appropriate to compare Zillow with the Evil Empire... haha! | ||
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denlee private msg quote post Address this user | |
| Something else to be aware of regarding Zillow is that they have a way too cozy relationship with supposedly independent Inman (real estate) News, who we have often referred to in comments on Inman.com as ZNN (The Zillow News Network). One of their 'impartial' regular contributors used to work at Zillow, and his daughter still works there for goodness sakes! Zillow is the #1 paying sponsor of Inman events, where REALTORS pay their hard-earned money to listen to Brad Inman throw softball questions to his buddy Rich Barton, so they can reassure many brainwashed REALTORS that Zillow is their friend! Talk about a Trojan horse! Barton even admitted a while back that it was always their intention to infiltrate traditional real estate, and then become the dominant player. So by Barton's own admission, Zillow lied to the real estate industry for years, which is why I call him their Zilliar in Chief! If you search Inman News using 'Zillow' as the keyword, you'll be hard-pressed to find any story that doesn't fawn all over them. For example, every time Zillow reports a loss, which by the way they have a 'perfect' record of, losing money in EVERY single quarter since their inception 15 years ago, the typical Inman headline is something like 'Zillow sets new revenue record' when it should read 'Zillow loses more money this quarter than even we thought was possible'. While Deano is correct that Zillow has a lot of cash on hand, it's all Wall Street 'funny money', not net cash generated from their business operations, like a profitable business would have. Shockingly, they purchase their flip houses using not their own cash but 100% borrowed money, which makes them just plain stupid. The largest reported single expense in their ibuyer (house flipping) money-losing disaster is interest charged on the money they borrowed to buy the houses and hold them until they sell. That's the equivalent of any of us carrying large high-interest credit card balances while we have a ton of cash earning us almost nothing in the bank. I've read a 'million' times how 'smart' the people at Zillow are, but the reality is that they're incapable of ever making a profit. As a comparison, would anyone consider a Photographer or a Realtor a success if they had annual revenue of $500K and expenses of $550K? Add a few zeros to those numbers, and you've got Zillow. CoStar conversely makes a serious net profit every quarter. Who is smarter? Admittedly, the people at Zillow have proven themselves to be good at some things: - building an effective consumer facing website that a majority of consumers like. - persuading the National Association of Realtors to think of them not as a competitor, but as a partner, so they could replace realtor.com as the #1 consumer real estate web portal (which they did). - persuading REALTORS to pay them for buyer leads of dubious value, using the REALTORS' own MLS data which they obtained for free, and relieving REALTORS of well in excess of a BILLION dollars a year in the process. Here's what they're not good at: - could anyone imagine it being even possible to fail to make a huge net profit with well over a billion dollars in annual revenue, and all you have to do is run a website using data that you paid nothing for, capture leads, and sell them to REALTORS? I bet Dan could make that work! - they have failed to understand that flipping houses is a specialized LOCAL business in each market from which only a handful of talented and experienced local players consistently make any decent amount of profit. It bears no relationship to their core business (website & selling leads). You could compare it to someone with no experience in the hospitality industry who buys a bar because they've had plenty of experience drinking alcohol in bars! - They have apparently realized that they've dug themselves into a deep hole with house flipping, but instead of quietly retreating back to their core business, they've decided to keep digging the hole deeper by entering the real estate brokerage business in a tunnel-visioned view that if they lower the selling costs of disposing of their flip houses they could possibly make a profit. Unfortunately for them, real estate brokerage is a really tough business (ask any Broker). Like house flipping you need a deep understanding of each local market to even have a chance of succeeding. That's why almost all successful brokerages are locally owned. Smartypants Rich Barton from the Silicon Valley bubble has about as much chance of making this work, as I do of being the first man on Mars. Seriously, Barton and his fellow flunkies should read 'The One Thing' by Gary Keller, the co-founder of Keller Williams. Note: neither my wife or I have ever been affiliated with Keller Williams in any way, but we used to live in Austin TX (the birthplace of KW), and we know that Gary is not just a really smart guy, he knows how to make real money. |
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Deano private msg quote post Address this user | |
| Preach brother Denlee! 100% agree with almost everything you've said. Here is what you are missing on the ibuyer thing. 1. They are only in markets where cookie cutter houses are the norm. Easy to value and easy to liquidate 2. All of their profit comes from getting a 35% referral fee on the sellers that approach them first and are not agreeable to selling at a 10% discount with 8-10% commission. They are basically getting 1% on every seller that walks through the door that doesn't sell to them and for the time being they are getting 5-10% on the ones they buy. That is pretty damn smart if you ask me. While they are not profitable, that's not the case with anyone that has bought their stock in the last several years. They are generating revenue for their shareholders and THAT is their only objective. While I love capitalism, I despise Wall Street. |
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denlee private msg quote post Address this user | |
| Zillow of course has never paid a dividend to its shareholders, therefore they have never generated any 'revenue' for them. Anyone who may have made a capital gain by buying Zillow stock and selling it at a higher price is of course no longer a shareholder. The recent rise in the price of Zillow stock is in no way supported by the financial performance of the company, but rather it's apparently driven by the illusion that we are once again in a never-ending real estate boom. Unfortunately, the alarming rise in the delinquency rate of home mortgages portends a coming mortgage crisis which could easily be much worse than 2008. Evidently, we never learn. |
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WGAN Forum Founder & WGAN-TV Podcast Host Atlanta, Georgia |
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| @Deano @denlee Thank you for your thoughtful, additional insight on Zillow, Inman and CoStar. WOW! Dan |
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| @Deano @denlee Does this impact any of your thoughts (above) on CoStar meets Houses.com? Inman (7 January 2021) CoStar headed to court following failed acquisition of RentPath | RentPath petitioned a bankruptcy court in Delaware to expedite payment of a $60M breakup fee. The letter demanded payment within 2 days from the Dec. 29 filing "CoStar Group is heading to court over a nearly $60 million break-up fee levied a week after the company’s attempted acquisition of Rent Path was spiked following an intervention by the Federal Trade Commission," reports Inman. "RentPath, which filed for Chapter 11 bankruptcy in late February 2020 prior to the attempted $587.5 million acquisition by CoStar, petitioned a bankruptcy court in Delaware to expedite payment of the break-up fee, which is currently being held in escrow. The letter demanded the payment within two days from the Dec. 29 filing," reports Inman. Dan |
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| Inman (12 January 2021) Zillow CEO Rich Barton is still the most 'powerful' person in real estate --- Free 90 day trial of Inman with this WGAN Affiliate Code |
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| Inman (20 January 2021) The end of free rental listings on Zillow is here | The company announced the changes would come in November but finally ended free rental listing syndication this week @denlee @Deano How does this Zillow news impact your thinking about Houses.com ...? "[Zillow] will now require contracts between brokers and Zillow in order for listings to populate the nation’s most popular real estate portal through its Feed Connect platform. The company is no longer publishing feeds from multiple listing services without direct agreements with listing advertisers," reports Inman. Dan -- I encourage you to subscribe to Inman. Free 90 day trial of Inman with this WGAN Affiliate Code |
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Deano private msg quote post Address this user | |
| Well, the only reason Zillow can charge is because they have all of the eyeballs. Agents aren't really all that concerned with lease listings - there is little money in it. What this will likely do is just force landlords to sidestep using an agent so Zillow can take all of that monetization for themselves. Places like NYC are different, but for most of the country this doesn't really impact the debate IMO. Houses.com COULD use this as a way to attract consumers (renters and landlords) AND agents. But, that is a lot of marketing dollars chasing such a small segment of the market. |
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 Screen Grab from Inman Connect Tuesday, 26 January 2021 @Deano @denlee CoStar Group Founder and CEO Andy Florance compares/contrasts Zillow.com versus Houses.com plans. Super-interesting how DIFFERENT Houses.com will be compared to Zillow.com (Houses.com will obsess on being in support of real estate agents. And, not be misleading about the Contact Us (thinking that you are contacting the listing agent; among other things.) I will post more on this later. Dan |
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| @Deano @denlee Andy describes Zillow's "uberization" of real estate agents. Dan |
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 Inman Founder Brad Inman and CoStar CEO Andy Florance | Screen Grab courtesy of Inman Inman (26 January 2021) CoStar CEO: 'The residential agent is Zillow’s competitor' - CoStar CEO Andy Florance revealed in great detail his ambitious plans to build a residential real estate platform during an Inman Connect session Tuesday '“If one company controls all the rides — or the buyers — then they determine the price and the fee and the role of the agent,' [CoStar CEO Andy] Florance said, before noting that Uber drivers only make about $24,000 a year," says Inman. "Florance pointed specifically to one of Zillow CEO and co-founder Rich Barton’s past companies, Expedia, which all but rendered the travel agent obsolete." I encourage you to read the entire Inman story. Dan --- Free 90 day trial of Inman with this WGAN Affiliate Code |
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denlee private msg quote post Address this user | |
| Brad Inman (Inman FAKE news) is a total fraud and a phony. Most of his income comes from BIG TECH Zillow. | ||
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denlee private msg quote post Address this user | |
| Someone needs to ask Brad Inman (i.e. beneficial interest) how much stock and options he has in Zillow! | ||
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