Limited Time Offer - Try the course right now, FREE for 14 days!

Agent Redefined Real Estate Marketing

Video and Social Media Marketing for Real Estate Agents

The Future of the Real Estate Industry 2018

The Future of the Real Estate Industry 2018

NOTE: Thank you to everyone who commented and read this post, I truly appreciate you taking the time to read it and value your opinion whether you are for or against this idea. And that is just what this article is about, an idea and starting a discussion about an issue facing the industry today. Enjoy reading… El Guapo I was driving home from a real estate photo shoot and saw this billboard ad near downtown Chicago. Welcome to 2018, let the race to the bottom begin. What’s incredible is that we, the real estate industry, created Redfin. We also created Zillow too! Before I move on, please note that I’m not a Redfin “hater”, or Zillow “hater”. There’s no hate here, I’m just a mex-e-can with an opinion about this topic. These websites are just giving consumers what agents are not: Free and Open Access to Listings Data Online. They are not stealing the data. We are giving it to them.

Seth Godin on Disruption, Pricing, and the Future of Business

The brokerage and agent discounters are back. And even though they make up a small percentage of the marketplace, that could possibly change in the future. And if that did change and the discounters made up a majority of the marketplace, then the real estate industry would look a lot different than it does today. That realty would mean fewer agents would be able to make this into an actual career because agents would be reduced to becoming simply order takers and expert at opening lockboxes. Seth Godin is someone I think we should all check out. He has an interesting thing to say about pricing and the “race to the bottom”. Watch this clip at 2:25 to 2:55 covers the “Race to the Bottom”.

It’s all about information

Redfin, Zillow, Trulia, and the rest are not the bad guys here. The guys that are responsible for the current state of affairs when it comes to YOUR listings data are the MLS’s, the National Association of Realtors, and every local Realtor association in the country. Let me explain. Our current system for how we handle listings data is an outdated system designed for a pre-internet world. Currently, agents upload thier listings to their MLS. Typically, there is no branding allowed on any of the visuals or remarks that are being uploaded. All of this listings data is then kept hidden from rest of the world, except for the data feed the MLS’s supply to third party portals like Zillow, Trulia, Redfin, Homes.com, and the rest. The MLS is sort of like North Korea. The MLS closes off itself from the rest of the world, except for it’s member agents and the information they decide to let out. Therefore, no buyer and/or seller can connect directly with an agent for a listing, because there is no way for the public to access this data unless it’s through one of the third party portal sites. Instead YOUR listings data is fed directly to the third party portals where they can then up-charge agents for leads and premium advertising on thier websites with YOUR own data. And YOUR data is gold baby, gold… Third party portals like Zillow are literally making billions of dollars in revenue off of YOUR listings data. Plus, the third party portals are building powerful brand recognition that is topping over even the largest brick and morter brokerages. Don’t believe me? When a buyer/seller goes online to search for properties are they more likely to end up on Zillow or Remax.com? Even past president Barak Obama choose Zillow over NAR in his series of town hall meetings about the housing recovery. Follow the money. Article, CNBC February 8th, 2018: “Zillow Group Reports Fourth Quarter and Full Year 2017 Results”. Revenue for Zillow (full year 2017) was up 27% to $1.1 Billion. Read the full article on CNBC CLICK HERE. Again, your listings are being fed for FREE to the third party portals, and then you have to pay the third party portals for leads coming from your listings. While at the same time, the website and system in place for marketing and selling homes, the MLS, is closed off from the rest of the world. It’s a backwards and outdated system and it’s giving agents a raw deal.

What the MLS is and what it should be…

The MLS is the most powerful tool that any real estate agent has. It has always been that. The MLS is both a marketplace and a social network. And YOU, the real estate agent, OWN IT! I know technically it’s not, but it’s still YOURS. You pay for it, you own it and the executives that run it are stewards of it. The MLS is the most efficient marketplace for both buyers and sellers to interact and exchange information so that they can buy and sell properties. It’s so beautiful, like eating a fish taco and watching the California sunset at the same time. However, the public doesn’t know this. Because we have allowed the MLS to operate as if we were still in the Cold War. Remember, it’s like North Korea and closed off from the rest of the world. As Ronald Reagan would say “Tear Down This Wall”. We need to tear down this wall and make the MLS public. This is the case for a single national public MLS.

How to Beat Zillow and Protect the Real Estate Industry for Future Generations of Realtors

Currently, the MLS is broken down into several hundred local and regional networks. The current system creates an extreme amount of redundancy and inefficiency from a technology and business standpoint. We need to break up these mini-monopolies and create one single country-wide MLS with a public facing portal. Once we have this, we can stop feeding the third party portals with your listings data and agents can begin directing web traffic to the new public MLS. In this scenario agents can connect directly with both buyers and sellers online. This will not come easy. Because change is hard. And when money is involved, it’s even harder. Each MLS has a Board of Directors, CEO, CFO, and other executive and middle management employees. If we were to create a single public MLS many of these employees will lose thier jobs. I believe they will fight to protect thier jobs and keep things the way they are. But if we don’t start the change now, then future generations of Realtors may not have the same opportunities that you have today.

The Future is on the Rank and File REALTORS, not the Current Leadership

The current leadership of the NAR, the MLS’s, local boards, and even at the major brokerages are not going to change this situation. They will continue to empower companies like Zillow and Redfin until it’s too late. To me our leadership’s position is like the U.S. Policy towards the Soviets during the 1970’s. The policy was called, Detente, look it up here. It did’nt work and almost ruined our little experiment in democracy and freedom. We need to begin a conversation about what the future of the real estate industry is going to look like and who is going to lead it. Here’s my plan for starting that conversation. Step 1: Rank and File agents need to become aware and educated about this situation so that we can begin to have more conversations about how to move forward and save this industry from itself. This is where I believe the Women’s Council of Realtors has a major role to play. More on that coming soon. Step 2: Next, once a movement is formed from the ground level we need to change the current leadership at the MLS’s, NAR, and local boards. They need to be replaced by actual agents who understand and acknowledge the situation and are willing to make the tough choices for real change to occur. Step 3: Build the National MLS Database. The technology already exists but it must be implemented. We can take the best MLS we have now and use that as the base. The new public MLS must offer a phenomenal user experience for consumers searching for listings data. If we want to take on Zillow, then we must also think like Zillow and be consumer-centric so that we can build out the best consumer experience for searching for properties online. Step 4: Training future and current agents. We need to redefine what a REALTOR is in an online world. An agent today is much more of a consultant and trusted advisor than a salesperson. But it feels like we are still training agents to be just salespeople. The change here needs to begin at the core of it all, which is, Agent/Broker Licensing. How we currently license new agents kind of makes no sense. And the CE thing, I’ll just leave that there. After you took the 30 to 60 hours to get your license in your state how prepared were you to represent buyers or sellers in the biggest financial transaction of thier lives on day 1? Let’s look at the approach the beauty industry takes. It takes an average of 600 to 750 hours of training for someone to become a cosmetologist. They practice, practice, and practice. It’s not easy and it takes a real commitment to become a licensed cosmetologist. We are going to have to develop some type of an apprenticeship program where new agents take the course work, but also work within a brokerage or team for hands-on training. Finally, we need to learn more about actually sharing and helping each other out. We need professional courtesy. Little things like giving showing feedback or just being nice to a buyers agent who just submitted an offer on your listing. If we want to keep that 2.5% (average) commission then our professional standards, ethics, experience delivered, and value proposition must also up its game in a major way.

The Next Generation of Agents

The next generation of agents will be more tech savvy, but more important than being tech savvy will be developing agents who truly care about thier clients and this business. We will need more Zig Ziglar, than Alec Baldwin from Glengary Glen Ross. By focusing more on delivering a phenomenal buyer and seller experience and offering true value to the marketplace Realtors can win this battle and begin leading what this industry will look like in the future, instead of being led by companies like Zillow and Redfin. So let’s end this with some Zig Ziglar. It’s all really just about this:
“You can have everything in life you want, if you just help enough other people get what they want…”

Interview w/Peter Lorimer talking about Video Marketing for Agents

Reader Interactions

Comments

  1. Redfin is NOT a portal. They are a brokerage. They have a different model, however to lump them in with Zillow is incorrect. I have no affiliation with them but have transacted business with Redfin agents and for the most part it was just like any otehr transaction. Discpiunt broekrs ahve been around forever. If this was the preferred way consumers wanted to do business then Help U Sell would be the largest broker in the world. In the absence of value, price is the only factor. Bring value to your clients and they will prefer your services.

    Reply

    • Thanks Jason for the comment. Really appreciate it…

      Just have to disagree to disagree and I’m glad that we are at least starting this conversation.

      You are correct in that Redfin is not the same model as zillow.

      If you read the article there is nothing negative said about Redfin agents.

      The point here here is asking Why do we have the system we do now, and why not just build the system ourselves. Essentially disrupt ourselves and try and make it into a better outcome for agents in the long term and to focus more on bringing value instead of competing on solely price.

      But thanks for checking it out and we really appreciate it.

      Reply

  2. The assertion that Zillow, or Redfin, or any third party provider simply accesses this data fur FREE and then uses it to make money is inaccurate. All of these portals pay for access to this information just like the rest of us … it’s what they DO with the information that makes a big difference. There is no way to distinguish between selling that information to us or to Redfin. If you read up on the Anti-Trust action taken against those that sought to reserve/preserve that information for exclusive use, you’ll see it’s not a simple matter of “taking back” the information … Congress has mandated that the information is available to any/all willing to pay for access. In my market, I regularly see Redfin customers who are aware of the disadvantages of working with Infosys inexperienced reps (among other shortcomings). As always happens, discounting can only survive in a certain type of market. Disrupting the disruptors … it’s still early in the game.

    Reply

    • Thanks for the info Mike and your comment. I just feel that there is a better way than what we have now and to continue down this path makes no sense. You are correct, it’s what the portals do with the info that makes the difference, but why not let agents do that? Why not just let agents connect directly with consumers through the MLS and eliminate the middle man. It’s a conversation worth having and opposing viewpoints are essential to hopefully building out in the very least a better deal and system for agents to connect direct with consumers.

      Reply

  3. You have said in few sentences what I have been preaching for years. The anger Realtors have been having with NAR and their local boards is one in the same. Too many not will to or unable to embrace the future. No, scratch that the present. Technology is here and it is not going anywhere. Technology/ Social Media is so powerful it has elected a president.
    I have been in this business for well over 20 years. An in that time I have witness contract go from 7 pages to more that 30 . I have seen the advent of Fax machines, email and not docu-sign. Where there is virtually no paper pass the hands of the buyer and the seller. And for many of them it they are not reading merely signing where they see to sign.
    This is where we as the Real Estate Professional must step in, showing our value and teach them what they are getting themselves into. What are they are signing is a document that is going to either be the best decision in their lives or it may cause them some major financial damage in the future.
    This article is timely and I will be sharing it in the groups that I am a member.

    Reply

    • Not really.

      Hola Liz, and thanks for your comment.

      Look up how much News Corp purchased Move Inc for. Then look up listings on it. Look for your own listings. Especially if you don’t have a “Featured Listings Package”. Try and find your listing agent info on your own listing. If you can find it i’ll buy you a taco.

      Next, look up how many hits per month realtor.com gets. Then look at what Zillow/Trulia gets. It’s not even close.

      Reply

      • “look up how many hits per month realtor.com gets. Then look at what Zillow/Trulia gets. It’s not even close.”

        How is this new planned portal going to be any different? How will you drive traffic/awareness for it?

        Reply

        • Hi Drew, thanks for the question.

          IS IS DIFFERENT? Yes and No.

          It’s the marketplace, we are just taking it online to connect agents directly with consumers.

          In many ways it’s the same.

          Except, for eliminating the middle-man. That’s the part that doesnt make sense to continue doing. Why not be the entity that is connecting listings directly to consumers instead of doing what we are doing now?

          TRAFFIC/AWARENESS: Part of the national discussion is education. When search engines produce the results for a search query that search is looking for the websites that have the best possible info to answer the query.

          The MLS is a goldmine of data. It won’t happen overnight, but the data being public and optimized for search will drive it to the top of the searches.

          There also must and should be a marketing campaign that coincides with the launch.

          Reply

          • I don’t get it. This is the same as the Broker Public Portal discussion. I have still yet to hear any argument as to why consumers (aka the buyers who pay the entire industry’s bills) will care about a new portal. Realtor has been trying the “fresh data” approach with ads for years and it doesn’t seem to be working to take market share from Zillow.

            “Except, for eliminating the middle-man. That’s the part that doesnt make sense to continue doing. Why not be the entity that is connecting listings directly to consumers instead of doing what we are doing now?”

            There are thousands of agent/broker/franchise sites doing this already. Why aren’t they able to grow traffic?

          • Now that is a really good question: And this is part of the mis-information about web search and basic SEO in the real estate industry.

            I’m not an expert at SEO, but I’ve learned enough about this from running my own WordPress site for the last 5 years. During that time we have relied on content to drive organic search traffic to our website. We do run Facebook ads but we don’t rely on that for traffic to this website, those are used for running traffic to our photo/virtual tour site http://www.AgentRedefinedMedia.com

            I’ve used content on this website to drive organic search. I don’t even publish that many articles. But even with just a little content we are able drive more than enough searches here to keep a one man show more than busy. Below is my Google Analytics, this month was higher because of the extra traffic from Facebook, someone shared this article on in a group on Facebook and that drove quite a bit of traffic here, that normally is about 200 to 300 hits.

            The search engines just want the websites that will best answer the search query.

            And just because all of these IDX websites claim to be “SEO Optimized” that doesn’t mean they actually are. Site like zillow are very intelligent when it comes to content and online searches. One of the reasons why Zillow pops up on the first page is because all of that data and content is indexed on thier site to drive organic searches. They also run ads, but organic is a major part of thier strategy.

            Top Referral Sources
            Referring URL Sessions %
            (direct) 2899 35.84
            google 2419 29.91
            m.facebook.com 1881 23.26
            facebook.com 378 4.67
            bing 106 1.31
            lm.facebook.com 96 1.19
            l.facebook.com 78 0.96
            pinterest.com 76 0.94
            yahoo 43 0.53
            api.convertkit.com 18 0.22

  6. George, you’re spot on and clearly a forward thinker, or at least you just live in reality. One thing I will point out, however, is not all MLS’ give their data to Zillow, etc for free. California, for example, gives the brokers back a cut of the syndication fees paid by the portals. So effectively the brokers make money off sharing their data with an already established portal. Just some food for thought on how a national MLS structure could financially incentivize brokers to participate.

    Reply

    • Hola, Eileen, thanks for that info. Is that the whole state, or just one/several of the MLS’s in CA? The other ugly part is the fees that the MLS’s get for syndicating out your listings. I’m going to look into that more again thanks for sharing….

      Reply

      • Check out CRMLS. From their blog a few years back: http://blog.crmls.org/updates/crmls-gives-back-brokerages-participating-data-syndication/
        That outlines it a little better.
        But imagine if a national MLS was built on one of the existing MLS technologies (for the sake of not re-creating the wheel for MLS technology), didn’t require association membership, charged portals a fee for the data (for the sake of revenue generation and not re-creating the wheel for portal technology), and then kicked back those fees to the brokers who participated in the national MLS. Sounds like it could be a win-win for all.

        Reply

        • Also, I’m not sure if CRMLS covers the entire state or just most of the state, or what. We don’t operate in that market so I’m not sure but I just had come across this information at one point.

          Reply

        • You are exactly correct. We don’t have to recreate the back end of it. That has already been created and like you say, we just take the best one we have. The part that has to built out is the public facing part. For this we have to focus on the User Experience. It’s the user experience that matters online. Zillow is focused on it and one of the main reasons they are able to keep consumers returning and using thier website and apps.

          Reply

    • Hola Wynee, I’ve seen Greg’s stuff all over with the stop zillow campaign. I agree with the overall message but I think his strategy is flawed. And it comes down to what we do with the MLS. Yes we need one website that agents own, operate, and have control on. But it should be a single public facing national MLS, not just another website.

      It’s not about stopping zillow or any other single website, it’s about connecting agents directly to the consumer online with listings data and taking the MLS, which is a marketplace, public.

      I think he’s raised like just over 300k at this point for his movement. I wish them luck and it would be interesting to see what the website and tech they have looks like.

      Honestly, if it’s that great, they should just put it out there for free for the public use and see.

      Reply

      • “we need one website that agents own, operate, and have control on. But it should be a single public facing national MLS, not just another website.”

        Please tell me, why would a buyer care about that? Will a portal that agents “own” convince them to stop using Zillow, Redfin, and switch to this new portal? How will the even know the portal exists?

        Reply

          • ‘There’s no need to convince anyone to stop using anything.”
            There is a need to convince them to change if anyone plans to make any money. There is a finite pool of buyers. They are already using websites/apps (likely zillow, redfin, or realtor). There isn’t some magical segment of buyers who are not using any websites that a new “agent owned portal” would capture.

            “Agents should become thier own Zillow collectively by taking the MLS Public.”
            Much of the MLS is already public and is on hundreds of thousands of IDX sites in every market. What’s the benefit to the consumer of having another Zillow in the world?

          • Thanks the for additional comments drew. I really appreciate it. I think the whole idea here is bigger than what you’re thinking and I’ll try my best here to lay it out.

            We are not talking about just creating another portal, we talking about restructuring the whole system to place data from agents directly to the consumer. It’s agents becoming Zillow. The basic infrastructure is already there.

            This is very much more about disrupting ourselves, and our own industry.

            Now the IDX. Just because an agent has an IDX feed on thier website doesnt mean or equate to web traffic no matter what the company selling the feed says.

            And your question is exactly what this should happen. It’s all about the web traffic. Basic SEO and search rankings are all about one thing, data. A Bing or Google search looks up the websites that bests answer the search query.

            The basic search query for homes is typically: “Homes for Sale in ____________ (town name)”, or “Condos for Sale in _________(town name)”.

            The search engines look up the websites that will best answer this search. They do this by ripping through the internet scanning every website that does so. This is where the agents collective power really is. Google and Bing and the rest just want the websites that have this data, by taking the MLS public into a single website and making sure the public side is optimized for search and can be easily found by the search engines agents can directly connect through organic search.

Leave a Reply

Your email address will not be published. Required fields are marked *