Surfing the Third Rail with Zillow, Opendoor, and MLS
Business model disruption can inspire and coexist with tenured ventures because new entrants find success if they can find product-market-fit.
Zillow and Opendoor continue to leverage the MLS ecosystem to grow.
These organizations are cited interchangeably when talking about radical players in the industry, despite their obvious differences.
- Zillow is the most popular brand in housing.
- Opendoor is a home sale fulfillment vendor.
- An MLS officiates real estate data.
The most electrifying forces in the space are powered by virtue of their membership in an MLS and alongside the most traditional models too.
Zillow generates traffic and refers out customers, Opendoor segments sellers and re-lists those properties, while an MLS curates a compilation of activity.
- Zillow is the website to look at your home, your neighbors home, or houses for sale.
- Opendoor is the mature cash buyer for homeowners willing to transact.
- An MLS is an operating system for most houses that sell.
Zillow displays advertisements and Opendoor converts marketing using MLS data to induce real estate activity to be later cataloged by an MLS.
The participants of an MLS differentiate on business development strategies but share activities following customer acquisition.
- Zillow shares marketing goodwill that generates clients.
- Opendoor shares commissions for representing clients.
- An MLS shares data services to assist in serving clients.
The most innovative companies are building offerings within MLS frameworks that exponentially help subscribers and consumers.
Wide visibility of properties informs people about the market and empowers them to make decisions. The newly launched Zillow and Opendoor partnership highlights this as good as anything could.
Stoking the Fire for Better Real Estate Contract Software
Was the holy grail of real estate contracts under our noses all along?
It’s gone by a household name for nearly two decades in Metro Denver.
For as long as anyone here can remember, documents have been digitally presented to clients and to agents in the same shared software.
But unless you’ve sold homes in Colorado or worked on transaction management, you’ve probably never heard of the company: CTM.
Agents can originate and sign state-approved forms with their clients, and then integrate those executed contracts with other agents, online.
They don’t have conference swag or private Facebook groups or press.
It’d be tough to find a broker or an agent or a client who would give it a ringing endorsement. The user experience leaves a lot to be desired.
What it lacks in popularity and design, it makes up for in functionality.
Interoperability at its best
To get started, a buyer agent can prepare and sign a unilateral representation agreement with their buyer to privately start a file.
When the buyer is ready to make an offer, a buyer agent prepares a contract and imports metadata from a listing agent’s file and/or MLS.
The buyer agent assigns the document to the buyer for signature, and when completed it can be transmitted directly to the listing agent’s file.
The completed version is also stored with the buyer agent until the seller countersigns the contract, storing the new version in both agents’ files.
Most everywhere else, agents exchange signed PDF contracts by email and download, upload, append, sign, download, and email them back.
Cutting off your nose to spite your face
The advantages of CTM come at a cost. Everyone must maintain their subscriptions indefinitely for every other subscriber to derive its benefits.
And while some features are novel, interoperability is what locks us in.
Not surprisingly, my colleagues continue to seek out new alternatives.
Who can blame them? CTM looks and feels the same as it when it launched nearly two decades ago. It is the Microsoft Excel of agent tools.
I, to little fanfare, remain a champion of the current solution, for now.
CTM is not itself the holy grail of forms so much as a clue for how to find it
This is akin to the showing service decision many markets are facing.
Is the gain for one side of the transaction truly worth the breakage other agents and their clients will encounter with unintegrated new products?
What if interoperability fueled competition instead of extinguished it?