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Zillow facing a ‘battle of the titans’ in 2024 

With Homes.com in investment mode, Realtor.com and Redfin are reshaping themselves in pursuit of the top spot among home search portals, T3 Sixty experts say.

November 29, 2023
4 minutes

Key points:

  • In 2000, about 40% of people started their home search online. Now almost everybody does.
  • Instead of a referral-based agent business, Homes.com is pursuing a “throwback” marketplace model.
  • It’s hard to see Zlllow slipping from the top spot, T3 Sixty CEO Jack Miller said.

The portal contest for consumer traffic and agent attention has seen "significant action" this year, with Zillow, Realtor.com, Redfin, and Homes.com announcing acquisitions, changes in leadership, or tweaks to their model.

Jack Miller, CEO of industry-leading consultancy T3 Sixty, shared his perspective Wednesday along with Paul Hagey, T3 Sixty's SVP of publications during a webinar tied to the recent release of the annual Swanepoel Trends Report. (Note: Real Estate News and T3 Sixty share a founder, Stefan Swanepoel.)

Miller and Hagey explored how the top home search sites currently stack up and what's in store for 2024.

Last year, roughly 96% of people started their home search online, Hagey said, compared to only about 40% in 2000. However, one thing that hasn't changed is the fierce competition for dominance among portals. While Zillow maintains its top spot in terms of overall traffic and unique visitors, Homes.com has made a valiant effort to quickly climb the ranks.

CoStar "pushing money" into Homes.com

"Homes.com is in investment mode," Miller said, noting that CoStar has pumped considerable resources into growing its Homes.com name recognition this year. 

"This is clearly an investment that CoStar is making," he continued. "They have an asset not yet performing — that they recently acquired — and so they're pushing money into it in order to drive up the utility of it and to drive traffic."

And it's CoStar's $32 billion market cap that has led the way to Homes.com becoming a major player in the residential home search space in a relatively short time.

"Do we see any new and upcoming players in the market? Not really," Miller said. "The big new player is CoStar. This really is a battle of the titans."

Homes.com has made a different pitch to agents than Zillow and Realtor.com, Miller and Hagey added, suggesting that Homes.com represents a throwback that is more of a pure marketplace instead of a one that relies on referrals. CoStar CEO Andy Florance calls it a "your listing, your lead" model.

Redfin and Realtor repositioning for the future

Redfin announced in October that it would be transitioning its full-time employee agents in San Francisco and Los Angeles from a salary model to a traditional commission structure. But Hagey also sees Redfin pushing more referrals to outside agents instead of keeping them for their own agents.

"They're really hunting profitability," Hagey said of Redfin. "They are moving more towards a marketplace model where Glenn Kelman has talked about 55% of the inquiries next year will be sent to agents at other brokerages."

Realtor.com announced a new CEO in June as the start of a renewed push to not only take traffic market share back, but as a catalyst to take greater advantage of the larger News Corp media ecosystem. This is an important competitive advantage, Miller noted, and a strategy that new CEO Damian Eales had seen through with News Corp's Australian home portal REA.

"Eales moved here to the US, and he's actually here in Austin, Texas," Miller said. "So this is not some remote executive who flies and flies out. He's very hands on. And he is bringing the REA playbook to the US and doing something that's not really been done."

Following the leader, which is still Zillow

"We all know Zillow, of course, as the leader," Hagey said about the Seattle-based home search giant. And Zillow has remained busy throughout 2023 in developing its "super app" concept and continuing to grow through acquisitions, such as Zillow's recent purchase of Follow Up Boss, Hagey indicated. 

Challengers will find it difficult to knock Zillow off of the top spot, Miller said.

"They've maintained an enormous media presence and an enormous consumer presence, so it's hard to see them losing that top spot quickly because of how much they've invested over the past two decades," he said. "It's not just in the site and SEO and all of that, but it's just the brand equity itself."

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