Austin Realtors: Time to Pull the Plug on Zillow and Trulia

by Steve Crossland, REALTOR in Austin TX on October 27, 2013 · 16 comments

Austin MLS SyndicationAs of this writing, there are 837 homes for sale in the Austin MLS for which the “Syndication” choice is set to “no” in the MLS settings. That’s 14% of current Austin single-family homes for sale, a sizable number, spanning all price ranges. I applaud those Broker/Agents for not drinking the syndication Kool-Aid.

This means, specifically, those 837 Austin MLS listings are not being fed by the listing agent through the MLS to a syndication aggregator called ListHub, which in turn is the main provider of listing feeds for most syndicators, including Zillow and Trulia, and 60+ others. I single out Zillow and Trulia only because those sites are the biggest and most well-known syndication websites. They are also the two most notoriously aggressive in their efforts and tactics to sell expensive advertising to the same Austin Realtors who freely gave away their work product (listings) to these media websites.

But what the 14% means in practical terms is that if you are a serious buyer dumb enough to only be looking for a home on a syndication website, you are only finding 86% of available Austin MLS listings. Wouldn’t you rather know about all available listings that match your search criteria?

Conversely, wouldn’t you rather NOT be shown incorrect listing data, specifically, homes you find on Zillow and Trulia and other sites that are not even for sale, or that already sold months or years ago but still appear on these websites? Or a home listed for $500K with an “estimated” value of $423K, but which had multiple offers over list price before the listing even made it onto the syndication website?

These websites might be interesting time wasters for tire kickers, curiosity seekers and nosey neighbors, but they are not trustworthy sources of current, accurate real estate listing information. Maybe they are an easy “first look” for casual listing surfers in the very early stages of “thinking about” buying a home, just to get a general idea of prices in a new city or area of town. But real estate listing syndication websites are not valuable tools for a serious buyer. Nor do they offer a relevant advertising venue for serious sellers or their listing agents. That’s because these sites are not designed to help you as a buyer, or to help sellers sell homes. They are designed to sell advertising to Realtors.

And the 14% Austin listing gap is growing as more Brokers and Agents come out of the fog and realize that these syndicators are not our friends. These websites do not, in any way, cause any home to sell faster or for a higher price. So the question is, why do so many Realtors mistakenly believe that these third-party media advertising websites are a good thing? And why do so many Realtors wrongly presume that sellers want listings shown on these websites?

History of Listing Syndication in Austin
ListHub was activated by the Austin MLS for its Realtors in 2006 as a convenient way to get more internet exposure for listings. It seemed like a good idea at the time, and a good service to provide Realtor members. Brokers were told you simply need to activate your ListHub account and you can automatically send your listings to multiple internet listing sites. Most did, and it was the last time they thought about it – 7 years ago.

The problem is that 2006 is ancient history in terms of technology, internet and information sharing.

Think about 2006. The top selling mobile phone was the Nokia 1600. There was no smartphone, no tablet computers. No LTE, not even 4G. Facebook opened to the (non-college) public Sept 2006. Facebook Business pages were not introduced until 2007. Twitter launched in March 2006. So, for those who can remember the technology landscape in 2006, it’s easy to see why agents were enamored by the idea of “free” and easy placement of listings on public websites. But a lot has changed since 2006, and i’s not cool anymore. Syndication today is as relevant as the Blackberry.

For most agents, in 2006, it was hard and complicated to get their listings online. That is no longer the case. And back then, when Listhub started in Austin, the listing agent was properly identified as the provider of the listing information on sites where the listing appears. Just like the agent appears alongside newspaper ads, the yard sign, real estate magazines, flyers, etc. That is as it should be because the seller, through the listing agreement, has appointed the Agent to represent the seller and be the point of contact.

Real Estate Listing Syndication in 2013
Today, the advertisements of competing Realtors appear next to your listing. Listings are used by large media companies as nothing more than chum in the water to attract advertising dollars from competing Realtors. These are public companies that are in business to sell advertising, not sell real estate. The do not have the seller or listing agent’s best interests in mind.

Now a listing agent must pay to appear alongside the listing she represents even though it was her out-of-pocket expenditures that obtained the listing, paid for the professional staging, photography, and virtual tour. It was her experience and guidance that counseled the seller on home preparation, marketing strategy and the sales process. The listing is the listing agent’s work product, the photos, written copy, etc, all a result of her personal efforts, at her expense. Yet it is given away for free to a syndicator who turns around and obscures her from recognition in favor of random Realtors who paid to show up next to her listing instead of her.

The seller of that home didn’t expect that the advertising would be outsourced to a media company where it can be shown with an estimated price that conflicts with the list price. The seller didn’t expect that his listing would be used to promote other agents instead of the sale of the listed home. A lot has changed since 2006, not all for the better, and certainly not in the best interest of sellers and their Broker/Agents.

Passive vs Active Advertising
The “automatic” nature of the “set it and forget it” ListHub service is that most Austin Brokers turned on their ListHub feed in 2006 and haven’t logged back in since then. Meanwhile, other sites have been added to the ListHub service, a total of 60+ now, feeding sites that in turn “power” other unknown sites such as Yahoo Real Estate and thus spreading the listing to 100s of destination sites, the near-100% of which are completely and utterly unknown to the Broker providing the data.

The Broker, who is the account holder for the ListHub service, is not even notified when new sites are added, or when existing sites have added “powered by” sub-sites under their umbrella. It’s completely a passive setup.

99% of Austin Brokers have no clue, at all, which sites their listings end up on, how listings are displayed, or what is being done with the manipulated listing content. This is not a good thing.

Brokers owe greater care and awareness to sellers whose listing data is being spread around to places unknown. To the buyers of those homes as well, who may not appreciate that detailed facts and photos of their new home are now permanently archived and “owned” (per user agreements that no agent has ever actually read) by dozens of websites and used in ways they cannot control.

In fact it is, in my personal opinion, negligent on the part of those Brokers to allow this to continue. It’s why Sylvia and I stopped, why other Brokers have stopped, and why the Austin Board of Realtors decided it will no longer facilitate this activity. As a seller, you should want and demand better handling of the “data” that represents your sales listing, and the details of your home. You should call BS on the idiotic mantra that “sellers want as much exposure as possible”.

What you actually want is for your home to sell quickly, at the best price and with the least amount of hassle. Having your listing plastered across 100s of unknown real estate websites, like a permanent digital internet tattoo that can’t ever be removed, does nothing to further that simple, basic seller goal.

ListHub will say that Brokers have admin tools to control things. But once you de-select a single destination site, a big green “Maximize Marketing” button appears and pesters you forever after until you click that button, which is a one-click “everything, everywhere” turning back on of the blind feed to all sites. Clearly the entire syndication feed system administered by ListHub is designed to send as many listings to as many sites as possible so that those listings can be monetized by the end user marketing companies in ways that are not congruent with the actual purpose of the listing, which is to sell the home. Realtors should be in the business of selling your home, not supporting business models that simply profit from the display of your listing data and photos by selling ads.

Austin Pulls the Plug on ListHub and Automatic Syndication of Austin Realtor Listings
Because of the aforementioned issues, and many other issues not outlined above, the Austin Board of Realtors voted in October to discontinue the facilitation of listing syndication for Austin Realtors. The contract with ListHub will end April 30, 2014.

The decision about how and where seller listings are displayed and marketed online will rightfully return to where it belongs, which is at the Broker level, managed and facilitated by each Broker, in the best interests of the seller client only.

Austin Brokers will still be free to advertise and promote their listings where they please, including syndication websites if that’s deemed appropriate by the Broker and seller. But just as they need to call the ad in to the newspaper if they choose that advertising channel, or print flyers and place in a box in front of a home if they think that’s effective, or set up and pay for their own Broker Website where listings are displayed, Austin Brokers will have to make the affirmative decision that syndication helps sell homes, explain it to sellers, and make arrangements for their company listings to appear on those sites which the Broker deems relevant and helpful to the goal of selling the specific home.

The Road Ahead for Austin MLS Listings and Syndication
Even though the announcement about discontinuing ListHub has been made to all Austin Brokers and Realtors, and press release sent and some media exposure already happening, a lot of work remains to educate Austin Brokers and Agents about the decision and why it was made. I’ve summarized a lot of it above, but there remains what I believe to be a gross lack of understanding by the average “agent on the street”, as well as sellers, about how all of this works.

Our syndication Task Force in Austin met for over a year and grappled with the issue before finally making the recommendation to turn it off completely. We determined that half measures would continue to represent a form of “endorsement” for syndication, so the bolder step was recommended. No other major MLS organization in the US has made the decision Austin has made with regard to syndication.

I’m proud of our Austin Board of Realtors for taking the lead on this. I hope others MLS organizations will follow. Individual Brokers and Agents have done so already, and more announcements are expected in coming weeks and months. Austin Brokers don’t have to wait until April 30, 2014 to stop the madness. Just stop selecting “Syndication” when entering a new listing. The ONLY reason to select “Syndication” for your Austin MLS listing would be that you are afraid it will sell slower or for a lower price if you don’t. It won’t. Syndicating listings does not factor into the success of your listing effort, at all. Try it. You’ll see.

Many agents I’ve talked to about syndication who are in favor of it don’t see the harm. That’s because, I believe, they only see the surface of the issue. But that’s like looking at 3 pretty pieces of a 500 piece jigsaw puzzle and thinking you see the entire picture. You don’t. You see a fresh shiny syndication onion and think it’s good, but when you start peeling layers off that onion, each peeled layer reveals a stronger funky stench.

Start peeling. Educate yourself. Ask yourself seriously how your seller benefits from your decision to send the seller’s listing data out through ListHub, seting it free to be used and abused in ways neither you or your seller know or understand. Make the decision justify itself. “More exposure” is a cop out and has been disproven by those of us who don’t syndicate. So why should you keep doing it? You owe that level of diligence and understanding to your listing clients.

Those willing to study and learn more about the subject ultimately will conclude that syndication is a rotten deal that provides no value, at all, to the task of selling a real estate listing in Austin TX.

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