In this week’s episode, Keith Robinson and James Dwiggins sit down with industry experts Rob Hahn and Greg Robertson. The group dove into the implications of Compass’s acquisition of Anywhere and how different players in the real estate market, particularly portals like Zillow and Realtor.com, might react to this seismic shift in the real estate industry.
The Big Picture: Compass Acquires Anywhere
The conversation kicked off with the startling news of Compass’s plan to acquire Anywhere. This acquisition is monumental for the real estate industry, as it could lead to a significant consolidation similar to what we see in commercial real estate. Rob emphasized that if residential real estate follows this path, we might end up with a few dominant firms controlling the market, similar to CBRE and JLL in commercial real estate. In the context of real estate agents, this could mean a future where independent brokers may struggle to compete against these larger entities. The question is, how will these companies adapt?
How Will Portals React?
The episode focused on how real estate portals such as Zillow and Realtor.com might respond to Compass’s acquisition. Rob pointed out that Zillow is the “king” of the real estate world, primarily because it commands consumer interest. If Compass starts to push private listings, Zillow may need to adapt its strategies to maintain its position.
- Ramping Up Rhetoric: Zillow could increase its marketing efforts, claiming that private listings are detrimental to the consumer.
- Rewarding Friends and Punishing Enemies: Zillow might offer better deals to companies that align with its interests while penalizing those that don’t.
- Total War: A more aggressive option could involve Zillow cutting ties with agents who are associated with Compass, thereby trying to force agents to choose sides.
- Franchise Model: Zillow could consider becoming a franchise or brokerage, leveraging its vast consumer base.
The Role of Real Estate Agents
As a real estate agent, it’s essential to keep an eye on these changes. The potential for a real estate franchise model from Zillow could reshape how agents operate. If Zillow becomes a more prominent player, agents might find themselves in a position where they need to align with the brokerage that can provide them with the best leads.
Competition and Breakage
Keith raised an interesting point about the possible “breakage” within Compass’s acquisition strategy. If a significant number of agents leave due to dissatisfaction, it could jeopardize Compass’s ability to service its debt. This situation could lead to a domino effect, where other companies in the real estate market may hesitate to invest in similar models.
Homes.com and Realtor.com: The Underdogs
Towards the end of the discussion, the group touched upon Homes.com and Realtor.com. Both platforms are struggling to maintain traction in a rapidly changing landscape. Homes.com is seen as a potential player in the quest for a new MLS, but as Greg stated, it lacks the necessary traffic to make a substantial impact. Realtor.com, tied to the NAR brand, faces challenges in being nimble due to regulatory constraints. However, both platforms are exploring options to align with larger brokerages, potentially transforming the way listings are managed and accessed in the future.
Conclusion: Focus on Your Clients
As the episode wrapped up, the group agreed on one key takeaway: amidst all these industry shifts and discussions about real estate investing and technology, the most important thing for any real estate agent is to focus on their clients. Amid the uncertainty, reaching out to past clients and maintaining those relationships can be a solid strategy for navigating the changing landscape of the real estate market.
