In response to the Globe and Mail article.
The Zoocasa team was excited to see the investor response to the Zillow IPO yesterday. In many ways it validated our advertising-focused business model which, like Zillow’s, works with and supports organized real estate and also fills a consumer need and want around supporting the research phase of the buying cycle and embraces the ideal of wider access to data. That want, to research online on our own on, should not be a surprise. We all participate in that activity whether it be for a car through Edmunds.com, a hotel room through Trip Advisor, espresso machine through Amazon reviews etc… It is the expectation today and we are suspicious if we can’t (more on that later).
I was interviewed by the Globe and Mail yesterday about the Zillow IPO and reiterated Zoocasa’s position as above. In the conversation we also discussed the differences in the US industry when Zillow entered the market vs. the Canadian industry today. This led to a quote attributed to me, the lead quote in the story: “The Canadian real estate industry has spent a lot of effort on keeping that data to itself”. While I could just say that this is a misquote, I think it would be more prudent to share the context of the actual discussion.
The Canadian effort I referenced in the conversation was the co-operation between the MLS bodies across Canada to provide that central resource and the resulting service that is available to Canadians today and I would argue, has served Canadians well, to date. We also discussed the complexities around having data available in a Zillow-type form in Canada at scale, and as all in the industry can probably agree, the desire to do this even with total support of a brand, broker or agent, can be trying.
Wrapping this up in a sexy one-liner suits itself for the story but it certainly does not represent the discussion.
Zoocasa is designed for two specific audiences, home buyers and real estate professionals; and during my tenure as President, not CEO (as mentioned in the article) though that sounds much more important, have worked with the industry following its rules in terms of securing listings for display. As the article correctly states, we have secured Board agreements across Canada and follow their guidelines as required. We have Canadian brokers and agents distributing well over 120,000 listings to Zoocasa on any given day.
Obviously we are totally in support of CREAs data distribution facility and support any programs that enable agents to have their listings be ubiquitous on the web, whether that be to Zoocasa or CraigsList or any other site where home buyers are looking.
Where we feel we provide more value to real estate professionals and will continue to lead in this regard, is in their ability to engage and promote themselves with the home-buying community online. We conducted a study with SRG Canada where it was discovered that the potential home buyer spends on average 11 months in their search. While that may seem like a stretch, when we see houses in some markets sell in days, sometimes hours, it seems reasonable when you think that the process of deciding to be in the market is more of an evolutionary decision. Zoocasa was developed to address that window.
Our task is to ensure we have the best platform for consumers to search for houses and we also believe that it is important the industry has an independent platform that presents innovative opportunities for real estate professionals to differentiate and promote themselves differently then what is available on their brand and industry specific sites; and connect with a user community that is moving more and more online and across a broad range of websites.
I’d feel remiss to not address another point made in the Globe article. The writer stated that Zillow was originally thought to be disruptive in the US real estate market and effect commission rates accordingly. It hasn’t played out that way in the US market and we believe the same result will occur in Canada. We believe that having the data widely available in Canada, under the appropriate guidelines, will remove a common consumer complaint about the industry in Canada and focus the discussion around the significant value add a real estate professional brings to the total equation.
Zoocasa does not aim to remove the agent from the process, in fact we are working very hard to help them get more engaged with potential home buyers. As real estate professionals know, this is the largest and most complex contract an individual will enter into in his lifetime. Online research, while important, is just one part of that equation.