Looking outside of real estate
“As a company, we are culturally pioneers, and we like to disrupt even our own business.” Jeff Bezos, Amazon CEO, in a November 2011 interview with Wired Magazine.
I’ve been in a real estate for a decade, and I can’t imagine a statement even close to that coming from any “leader” of the real estate industry. NAR, state, and local real estate associations have spent the past decade doing everything they can to preserve the status quo. As a result, pretty much all of the innovations that consumers have come to rely on have come from outside the industry, reinforcing a consumer view that the real estate industry is a dinosaur that isn’t aligned with the wants and needs of today’s consumers.
Did our industry disrupt? No.
Did NAR, state, and local associations want to do anything to disrupt the word-of-mouth referrals that many agents depend on for their business? Absolutely not. Instead, it was a little San Francisco company – Yelp – that started out with a focus on restaurant reviews. Consumers quickly used the Yelp infrastructure to review pretty much everything and anything, real estate agents included.
Did NAR, state, and local associations do anything to disrupt how consumers search for homes online? Absolutely not! Instead, companies like Zillow and Trulia built-out best-in-class consumer sites with a nationwide reach that put tons of information (accurate or not, that’s another story) about homes for sale at the fingertips of interested consumers.
Did NAR, state, and local associations do anything to disrupt how the industry polices the behavior of its members? Nope, of course not. In an age when you can find information about almost everyone and everything online, Code of Ethics complaints and other arbitration matters continue to take place behind closed doors.
Unwilling to reinvent
I don’t want to start sounding pedantic (or bitter), so I’ll summarize: The real estate industry has been unwilling and unable to reinvent itself. Our failure to disrupt the status quo and re-imagine what real estate could be hasn’t stopped others from doing it. Instead, we’ve handed opportunity after opportunity on a silver platter to others, leaving “the industry” to play catch up and look defensive and outdated.
And here’s the sad part: As websites have sprouted and technologies have been developed that make it easier for home buyers and sellers to do their research online, our state, local, and national association leaders missed the opportunity to put the agent at the center of that conversation. Want to connect with home shoppers? Trulia will gladly sell you a package – for about $80/month that will do exactly that. Want to appear above any agent’s reviews on Yelp? They will happily sell you an advertising package to make that happen.
We’ve arrived at a time when we are now arguing about whether or not it makes sense to syndicate our listing data to third party websites like Zillow or Trulia. Whether or not we will share our listing data with others isn’t the important question to me. It’s an interesting question, and I can see both sides of the argument. But I think it’s a distraction from the more important question: Are we going to find the courage to disrupt our industry and build the tools consumers demand, or will we continue to let others shape the future of our industry?
Benn Rosales
February 3, 2012 at 11:02 am
Hi Matt, love the piece. I wonder though if our thinking is wrong from the outset? Why do we consider anyone who isn't branded a realtor outside of the industry? Aren't the radicalized thinkers that innovate part of the industry? It seems to me we draw this line between them and us rather than just bringing them into the fold and working with them.
In the case of aggregation, truth be told, they are running data for free and have been for some time. Every business needs to make their own business decision on whether they'll syndicate for free or not. In that same spirit, the industry itself isn't one voice or one unit, it's each and every company that must innovate to remain competitive in their space, not the industry as a whole. In fact, the further away NAR and other orgs remain out of our businesses the better – we're already overly regulated.
Perspective is sorely needed I think.
Bill Petrey - real estate agent
February 3, 2012 at 11:19 am
MLS Data is all the National Association of Realtors have left of any value. If I could get full access without being a Realtor I'd drop my membership in a heartbeat. I suspect others would too. NAR probably knows this and is devoting its resources to protect it rather than being innovative. Of course they could be still working on the ethical thing. Can't believe they spent all that money on the theme of "we won't screw you."
Maybe innovation from NAR is too much to expect.
Matt Fuller
February 3, 2012 at 3:54 pm
Benn – I agree with you that it shouldn't be "us or them." Unfortunately, though, the industry policies and regulations are structured so that if you aren't on the "inside" it is exceptionally challenging to get access to the data you need to build a useful product. I'd love to see associations make it easy for others to partner with them on cool projects. I'd also love to see associations standardize their data models and regulations so that innovation happens at a faster pace and startups have access to bigger markets for their products without having to tweak their product for hundreds of associations.
Matt Fuller
February 3, 2012 at 3:57 pm
Bill – In addition to the data, I think Realtors themselves are the value in the era of information overload. It's unfortunate that we look like data hoarders. We have even more value once we set the information free, IMHO.
Abe Rashdyi
February 4, 2012 at 12:33 pm
One example of the lack of leadership is we as realtors are required by law to change listing status from active to pending or sold within 24 to 48 hours maximum, while a large number of advertized listings on Zillow and Trulia are pending or sold. This gives Zillow and Trulia a huge advantage; they can offer listings that buyers want. This is the fundamental premise on which Turlia and Zillow built their success.
Miss information? You be the judge.
Is it going to weaken consumer confidence in our industry? Think about it.
Should industry leaders require outsiders to live by the same rules as realtors? It is up to us.
Greg Cook
February 4, 2012 at 5:17 pm
BRAVO MATT!
We need to look no further than KODAK to see what happens when a business is unable or unwilling to reinvent itself.
IMHO consumers want more than listing information, much more. They need to know HOW or HOW NOT to buy, WHERE or WHERE NOT to buy, WHY or WHY NOT to buy.
Here's an interesting stat that I feel sums it up: "Less than 10% of Agents do it, but those that do get 88% more leads. Answer? Blogging!