Brokerage Firm Stops Posting Home Reviews

Saw this today in the Wall Street Journal. The Discount Broker Redfin has stopped allowing members of the public to post comments about MLS listings on the Redfin site. They’ve been fined $50K by the local MLS in Seattle. Interesting. Seems kind of creepy to me – many of the comments the hired “reviewers” would write about people’s homes were catty or insulting to the Sellers. Plus, if I were a buyer, I’d want to see homes in person and make up my own mind about the merits, or lack thereof, instead of relying on what others say.

Redfin hasn’t made it to Austin yet, but they’ve been giving MLS Boards and Realtors fits in other markets. Mainly because they admitedly want to disrupt and change the current real estate commission structure.

Brokerage Firm Stops Posting Home Reviews
Wall Street Journal
May 15, 2007; Page D3

A discount real-estate-brokerage firm based in Seattle, under pressure from rival brokers, has stopped posting Internet reviews of homes listed for sale.

Glenn Kelman, chief executive officer of brokerage firm Redfin Corp., said the reviews were popular with users of the firm’s Web site. A team of 15 free-lance reviewers, paid by Redfin, toured open houses in the Seattle and San Francisco areas and wrote comments. A sample involving a small San Francisco condo: “Forget about having guests over unless they are willing to sit in the oven, in which case you had best order in.” Though the tone was often irreverent, some of the reviews were favorable.

Redfin stopped posting new reviews on its site late last week to avoid losing its access to information on homes available for sale from Northwest Multiple Listing Service. Northwest MLS, based in Kirkland, Wash., and owned by participating brokers, operates a database of information on homes listed for sale in western Washington state.

Northwest MLS about a year ago sent a letter telling Redfin to stop posting comments about listed homes. The MLS cited one of its rules barring brokers from advertising details of homes listed by rivals.

Redfin argued that the comments, later expanded into more detailed reviews, weren’t advertising but rather supplemental information of interest to potential buyers. Northwest MLS rejected Redfin’s interpretation. Jeff Coop, legal-affairs manager of Northwest MLS, said other brokers reported that sellers complained that the reviews made it harder to sell their homes.

In April, Northwest MLS fined Redfin $50,000. Redfin is appealing. Northwest MLS also threatened to cut off Redfin’s access to MLS data, vital for attracting customers.

Meanwhile, Northwest MLS has told Redfin to stop posting information about the number of days each home has been listed. Without further explanation, that number can be “very misleading,” Mr. Coop said.

Redfin’s Mr. Kelman said multiple-listing services in the San Francisco area haven’t taken any action against the reviews. But Redfin suspended them in that market, as well, to be consistent and to avoid expected complaints.