I have a real problem with the new Realtor.com and MSN arrangement.
Here’s why:
First, Homestore did not ask brokers’ permission to do this. In my state it is illegal to post a broker’s content to a third-party Web site without that broker’s permission. It has agreed to do just that. Given its past relationship with many brokers, this was a risky move.
Second, Homestore is practicing unfair pricing here in my market and others. Every broker here gets a different deal based upon whatever the Homestore sales representative feels like offering. I have this documented. Our largest broker recently received a special banner and link deal for all listings for $1,000 a year, down from the original quote of $250,000-plus. As a smaller broker, I was denied that deal.
Third, LendingTree having ads and banners at the MSN Web site makes this relationship for content a really bad thing. More and more Americans are using LendingTree.com. As more and more people shop at MSN for homes as a result of this new content from Homestore, more and more consumers will leap off and go to a LendingTree ad even while looking at a Realtor’s information.
The net result is that LendingTree, which is already a broker in 30-plus states, will go the way of HomeGain and join as many Realtor boards as it can. LendingTree then will take the board’s data to RealEstate.com–when Realtor’s Compete you Win!–and be in a position to spend Barry Diller-type money promoting it. They in short order may join the Realtor boards or partner with their realty affiliates and have close to the same content at RealEstate.com as MSN or AOL will have. Fact is, they will outspend everyone else put together in advertising their Web site, and the marriage between that and LendingTree.com is really compelling.
LendingTree is executing a business plan that has been well thought out and has the support of everyone in their organization.
Homestore is not and does not have the support that some observers clearly feel they have. Realtor.com is run by Homestore. But make no mistake: they do not represent the best interests of Realtors on the whole. The day that they honor the use of my data for free by offering me the chance to have my name and contact information displayed in kind is the day I will begin to change my mind.
I have asked for that repeatedly and have been categorically denied each time. I am looking into legal action against Homestore for unfair trade practices and collusion in regards to the bigger brokers getting preferential pricing.
Best of luck to Homestore. It appears to me they will need it.
Dirk Knudsen is owner of RE/MAX Metro in Beaverton, Ore.
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