Trulia: Web 2.0 Real Estate Search
Via Memeorandum (which is so good that I'm now checking it multiple times a day) and Jeff Clavier comes word of Trulia, a loosely-joined real estate vertical search company.
Traditionally, listing real estate agents have charged 3% of a home's sale price to list a home on a local Multiple Listings Service. The National Association of Realtors (NAR) has seen that the internet reduces the information advantage that its agents possess, and is fighting like hell to protect its members' interests. They've attempted to do this by investing in Homestore.com, a vertical search engine that has exclusivity agreements with local multiple listings services to display properties on Homestore.
So, here we've got big commissions, an artifically-maintained listings monopoly, and a network that brings buyers and sellers closer together. In steps Trulia.
It looks like Trulia works by partnering or scraping real estate listings on "over 100,000 sites", aggregating the listings, marking them on the obligatory Google Map, and allowing visitors to slice and dice data by location, bedrooms, bathrooms, size, and price. It provides some really useful context for making a decision on a property, including local average list price, average days on market, and average sale-to-list-price difference. Also, Trulia offers email alerts and RSS feeds.
Trulia is playing nice with brokers and the MLS right now--they're just another channel to drive traffic to agents so they can make the sale. I bet the master plan for Trulia is to democratize property sales and become the "people's MLS". If Trulia achieves critical mass, watch for them to become a for-sale-by-owner listings clearinghouse and add some big bucks to their contextual ad revenue stream.
Trulia is a well thought-out product that makes searching for a property enjoyable (although I'm a real-estate dork and enjoy that kind of thing anyways.) Craigslist was the first blow against the NARs real-estate listings monopoly, and Trulia has solid potential to be the second. With Google working on integrating classified listings, it won't be long before the NAR is feeling the hurt that nimble, disruptive companies can bring on. It will certainly be fun to watch the poo fly in the real estate space in the coming months!
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Great posts... and I couldn't agree with you more that it will be fun to watch what happens over the next few months.
Another company to look out for is Zillow. Rich Barton is definitely thinking big and he's let it be known that his current interest is in real estate.
Dustin-
Thanks for the tip re: Zillow. I'll definitely keep my eye on it.
Kareem
Agree with Dustin, great post. Death to the Middleman!
Lew - love the new look of the site. I was reading the summary of your recent life, the entry about the high school graduation ceremony is hilarious - I had totally forgotten about that. -R
It seems like every month there is another company or concept that is going to revolutionize the real estate industry. Big names from other industries jumping into the real estate business and declaring how they are going to "fill the gap" or "eliminate the inefficiencies in a broken model". And every month these great pioneers and dynamic leaders get lumped into a pile of non-factor companies which make no difference at all in the overall scheme of things.
And the main reason all these companies fail is they think that some new idea is going to make everything change, but they do not understand that real estate is not just about listing a bunch of data or designing really cool programs to sort through the data. And it's not a broken model because of commissions. If charging a fee for services was a broken concept our capitalist nation would crumble to dust. The reason 90% of Realtors don't succeed in the business, even though there is apparently so much money just flying around in this broken model, is the same reason these incredible pioneers of other companies fail when they try at real estate- They are trying to quantify an emotional experience- and THAT is a broken model. The real estate industry is about so much more than a picture of a three bedroom home and a phone number. Being a Realtor is about helping people acheive their goals, protecting property rights, city planning and development, and facilitating an emotionally draining and stressful experience so that people feel comfortable while making, for most people, the largest single investment in their lives. And it is not easy to move three young children to an unknown place, or show someone the potential of that outdated home that's in a good area and the only thing they can afford as their first home. Complaining about commissions has become something of a sport online, but there are reasons people are still willing to pay for their Realtor's services- because at the end of the day it is worth every penny.
GT