- Friday, 01 August 2014 00:00
Godzillow. Godzilia. Zulia.
Whatever you want to call the shocking real estate news of the week - Zillow's announcement that it will buy Trulia for $3.5 billion in stock - the vote is still out on how this behemoth will change the future of the industry. Here is a breakdown of what we've gathered from this week's news, gossip and speculations.
What It Doesn't Mean
Zillow is taking over the world! - The media frenzy might have instilled some panic and/or suspicion in agents and brokers across the country. The merger should be watched closely but not feared. Zillow has historically been more focused on monetizing customers and less about helping agents and brokers - something that will need to change if they want to sustain long-term. Because at the end of the day, Zillow needs listings more than listings need Zillow. Plus we all know that the love/hate of the zestimate will only get them so far.
Zillow will replace the MLSs - Coupled with the recent Retsly purchase, the only MLS aggregator that helps real estate software developers sync to multiple MLSs at once, Zillow appears to be putting all of its ducks in a row. But remember that ultimately MLS boards still control the data. And it will be a long time before Godzillow will find a way around that.
What It Does Mean
Advancing Innovation. Zillow's purchase of Retsly was also strategic for another reason. Technological innovation in the real estate industry has been slow moving due to the fact that its mind-numbingly painful for developers to connect across 900 MLSs, many requiring uniquely formatted coding. With Retsly now powered by Zillow, perhaps we will see great strides in advancement of software that has stagnated from this issue.
Domination of real estate search. Combined, Zillow and Trulia already have 76% of total views among the most popular real estate sites. And with the increased media hype around Zulia, realtor.com will only fall further in the shadows. Although we do love their cheeky new ad campaign. Undoubtedly with less competition this will also lead to hire prices for brokers looking to advertise.
What It Might Mean
Back to just Zillow. Zillow and Trulia will continue to act as separate brands in order maintain their market share, saying “the two firms’ offerings remain differentiated and the consumer overlap in both brands is relatively low.” However, the deal could still be challenged by the government on antitrust issues. Apparently the aquisition agreement leaves Trulia at a big disadvantage and if antitrust disapproval stirs the pot, Trulia could be out of the game completely.
However this plays out, we're all sure to be watching closely.