CoStar CEO blasts Zillow as Homes.com faces scrutiny
Andy Florance has taken to social media to rebuke Zillow’s listing standards and “outrageous bullying.” But some agents are also unhappy with Homes.com.
CoStar CEO Andy Florance has taken a public stand against Zillow — again.
This time, Florance's criticism is addressed at Zillow's enforcement of its new Listing Access Standards — the company's move to bar listings that are publicly marketed but not widely available to consumers. Announced in April, Zillow formally started enforcing its new listing rules on June 30.
In his comments, which he posted to LinkedIn, Florance called into question the legality of Zillow's listing rules and suggested the company was leading an "anticompetitive cartel" with partners Redfin and Realtor.com. He ended his post with a strong call to action, encouraging agents across the country to "stand up to Zillow's bullying" and its dominant position in the home search space.
A double standard? "While Zillow preaches they are protecting the industry by requiring submission of listings to the MLS within 24 hours of public marketing, in fact their new rule does not apply to listings directly submitted to Zillow, and Zillow alone," Florance wrote in the post.
"How do agents and brokers keep earning commissions when Zillow aggressively holds the reins over four major real estate portals? Zillow is consolidating power over listings, buyer-agent commissions, and now, listing-agent commissions. How is this even legal?"
Boosting banned listings on Homes.com: Florance also noted that Homes.com had promoted the first listing to be barred by Zillow, following through on a promise he made in May.
According to a spokesperson with CoStar and Homes.com, the listing was from a Compass agent selling a 4-bedroom home in Gaithersburg, Maryland. Compass has also been a vocal critic of Zillow's listing rules, going as far as suing the home search giant over its Listing Access Standards.
"Over the weekend 10,000 potential home buyers viewed that 'Z banned' listing on Homes.com," Florance said. "I commend the agent that is standing up to Zillow's outrageous bullying and intimidation."
Competing models: Florance has long decried Zillow's business model and Premier Agent program as a "lead diversion" strategy that connects consumers and homebuyers with an agent who may know little about a specific property or neighborhood, and he has promised that Homes.com — whose model is based on what he calls a "your listing, your lead" strategy — will never sell buyer agent leads.
He has also predicted that the other major home search sites, including Zillow, Realtor.com and Redfin, would eventually adopt Homes.com's model.
Bypassing agents to pitch sellers? While Homes.com is not in the business of selling buyer agent leads, the company has been leaning into its premium "boost" feature where an agent can pay to have their listing pushed to the top of search results for home shoppers.
But the company has recently drawn ire from some agents who believe Homes.com is overstepping with its marketing tactics. According to Inman, the company has been sending 20-page glossy brochures — that may include an agent's photo and contact info — to potential sellers across the country pitching them on the value proposition of a boost on Homes.com.
The approach is making some agents uncomfortable: "It's scammy to use my personal information and my face and my branding to entice my sellers to spend money online," one Alabama agent told Inman.
A California agent described it as "a money grab" that interfered with her client relationship. "To me it felt like they went around me to try to make my clients feel like this is what they should be doing. I know how to do my job," she told Inman.