Industry leaders continue to weigh in on Zillow Preview
Reactions to the pre-market listing product center around seller choice, buyer access and “fair competition” — with a warning about potential DOJ scrutiny.
Key points:
- Zillow launched Preview in partnership with five major brokerage companies on March 17. In the two weeks since, over two dozen other firms have signed up.
- The launch was quickly followed by Compass’ dismissal of its lawsuit over Zillow’s Listing Access Standards — and unexpected praise from Robert Reffkin.
- Industry reactions have been generally positive, though one MLS leader suggested the product was not “the right answer,” and another raised concerns about future litigation.
It's been two weeks since Zillow announced Preview, its new product designed to promote pre-market listings before they go live on the MLS. Five brokerage partners signed on for the launch, with more than two dozen others joining a week later.
The rollout followed similar moves by eXp, which recently introduced its own "Coming Soon" listings deal with Realtor.com and Homes.com, and Rocket Companies, which brokered a partnership for Compass to display "Coming Soons" and "Private Exclusives" on Redfin.
But as the leading home search portal, Zillow's launch has made the biggest waves — and in some cases, elicited unexpected reactions.
Take, for example, the kind words offered by Compass CEO Robert Reffkin — one of the most outspoken critics of Zillow following the portal's introduction of new Listing Access Standards last April — just hours after the rollout: "A sincere thank you to Zillow for offering homeowners more choice. Sellers deserve the choice to decide when, where and how they market their homes."
A day later, Compass dropped its lawsuit against Zillow challenging the portal's listing standards, with the company claiming that Zillow had reversed its ban on listings that are publicly marketed but not widely available via the MLS. Zillow has disputed this claim, telling Real Estate News that Compass' 3-phased marketing strategy is still "at odds with Zillow's standards, which remain fully in effect."
Compass appears to have had a change of heart about Zillow Preview, with President of Growth Rory Golod claiming in a Mar. 30 post on LinkedIn that Preview "hurts sellers" but helps agents affiliated with his company's brands to "win listings" and gain "a relative financial advantage."
Here's what other industry leaders have been saying.
United CEO: Good for the housing market
"Zillow continues to press the point of fair competition for the benefit of the buying and selling public, brokers and agents," said Dan Duffy, CEO of United Real Estate — one of Zillow Preview's five launch partners.
"Bringing more inventory to market faster will have a positive impact on the U.S. residential housing market at a time where access to listing inventory is needed," Duffy said. "We are excited about Zillow's latest innovative offering through Zillow Preview and are equally as thrilled to offer it to our agents and their clients."
Side CEO: A 'competitive offering' for agents
As Compass' promotion of its 3-phased marketing strategy gained momentum, Side Co-Founder and CEO Guy Gal said his affiliated agents began hearing more questions from sellers about this approach. Side also signed on for the initial launch of Zillow Preview.
"When Zillow invited us to have a conversation about what a competitive offering would look like and how it would work, we were interested in that," Gal said during a Mar. 29 appearance on the Context with Mike DelPrete podcast. "Not because we believe that this is an important thing, or that this is a good thing for sellers, or that this is a good thing for the market, or for communities, or for buyers, or for the agents — because we don't."
But given sellers' increasing awareness of pre-market listings, Gal wanted Side-affiliated agents to be able to say, "I have a better offering, which is the Zillow offering, because that has more distribution compared to the Compass-Redfin offering."
"That was the whole motivation" for the Zillow deal, he added.
Gary Keller: 'Let the seller decide'
Keller Williams was another Preview launch partner, because "we believe an open market serves consumers the best," KW Executive Chairman and Co-founder Gary Keller said.
"Sellers should have the opportunity to reach the broadest pool of potential buyers if they choose to do so, because broad exposure generally benefits the homeowner," Keller said. And, he added, they "should always retain the right to set the parameters around how their home is marketed" — a statement reminiscent of Reffkin's "seller choice" messaging.
"Our job as professionals is to fully disclose and explain the options and let the seller decide," Keller emphasized.
Sellers get more control without sacrificing reach
Zillow's new offering, according to RealScout CEO Andrew Flachner, is a win for sellers.
"At a time of significant change across the industry, Zillow Preview gives sellers more control over how they come to market, without losing access to the largest audience of buyers," Flachner said.
"Zillow has continued to lean into an ecosystem where brokerages and technology partners can build on top of its reach."
And for Zillow itself, Preview "could drive listings differentiation and subsequent traffic," putting pressure on portal competitors, according to Stephen Sheldon, a Wall Street analyst with William Blair.
MLS perspectives on seller choice
Some industry leaders leveraged the announcement to offer their own spin on the broader themes of transparency and choice.
Zillow's latest move "confirms what sellers have been telling the industry for years: they want more control over how they enter the market," said Emily Girard, CEO of Unlock MLS and the Austin Board of Realtors.
But, she added, "the right answer for Central Texas sellers is not a national pre-market product or a private network's exclusive inventory. It is a cooperative marketplace that puts the seller in control from day one."
Unlock's Flex Listings option does just that, according to Girard, by creating a "private runway" for listings. "That is what a seller's choice should look like: control over when a listing goes public without restricting exposure to a limited private network or forcing it to be available to everybody on the internet."
While the Council of Multiple Listing Services (CMLS) didn't comment on Zillow Preview directly, it addressed the recent industry movement toward private listings and the "false narrative" that limiting exposure benefits sellers in a March 25 statement.
"Siloing and hiding information weaken competition between brokerages and moves the market away from an open, shared system toward a more fragmented one," CMLS wrote.
MLSs get to make their own rules, the statement continued, but those policies should "reflect a basic principle: markets work best when information is broadly shared, rules are applied fairly, and brokers compete on service rather than control over access to information."
A recipe for future litigation?
The brokerages participating in Zillow Preview agree to send their pre-market listings exclusively to Zillow — an arrangement that could eventually lead to government scrutiny, warned California Regional MLS CEO Art Carter.
On a recent Real Estate Insiders Unfiltered podcast episode, Carter recalled a 2004 Department of Justice lawsuit focusing on a then-new NAR policy that "at its core allowed brokerages to choose what other brokerages could display their listings on the internet."
"It's bizzaro world to me that we're back in the same place again," Carter said. "That's my concern is that, at some point — maybe not in today's environment, but at some point — this will be litigated again."