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The past 18 months have been a trying one for Damian Eales, who came to Realtor.com during tough times for the company, including a drop in traffic and lead volume caused by market headwinds from the pandemic.
On his journey to get Realtor.com back on track, Eales faced many challenges. The escalating conflict between CoStar Group and its luxury home home, Homes.com, the termination of cooperative compensation, two headline-grabbing legal battles, and rising home prices. market issues resulting from persistently high mortgage rates and worsening affordability;
Damien Eales
Still, Eales faces 2025 with great optimism about Realtor.com and its ability to not only withstand but grow under competitive pressures.
“[Competition] It makes us better,” he told Inman. “The past 12 months have been incredibly complex for customers, estate agents and estate agents alike. [multiple listing services] People who support the industry. We have played a critical role in supporting these customers through that transition, and as the industry continues to change, Realtor.com will continue to serve as a true buying portal for the industry. ”
Ahead of his second appearance at Inman Connect New York, Mr. Eales spoke about the rivalry with CoStar, the portal’s competitive environment amid changes in co-op compensation and possible changes to Clear Coop, Realtor.com We spoke with Mr. Inman about the groundbreaking issues that are attracting attention. Towards 2025.
Inman: Let’s start by looking back at the past year for Realtor.com. Much of the headlines over the past 12 months have focused on CoStar’s competition with Homes.com. There are trade secret theft lawsuits and advertising lawsuits with the National Advertising Department (NAD), both of which are linked to the “smoke and mirrors” that Realtor.com believes CoStar is using to deceive agents and consumers. The focus is on eliminating some. Do you think the lawsuits and challenges were time well spent?
Eels: First of all, we love competition. it makes us better. I think we’ve spent a very meaningful amount of time competing with CoStar, or perhaps more meaningfully with Zillow, not just competing head-on, but competing.
You mentioned some specific issues with CoStar, which we’re happy to discuss, but also competition in the sense that we do our own thing, our unique thing in the world. I think it gave me an opportunity to think about what my position is. How can we differentiate ourselves from the likes of CoStar and Zillow?
I think it was a particularly useful opportunity for us on certain issues such as the NAD process. This allowed us to demonstrate that one of our competitors was competing in a deceptive and misleading manner.
Similarly, they counterattacked with N.A.D. [complaint] And we were given the opportunity to prove that we are the most trusted number one [portal] For real estate professionals. I think actions speak louder than words in this regard and we are really happy with the results.
When it comes to NAD challenges, Realtor.com is a winner. As for the trade secret theft lawsuit, it will take time to resolve, with a court date set for August 2025. I can’t go into details, probably for legal reasons, but again, do you think the lawsuit was a good use of Realtor.com’s resources? It didn’t accomplish what the company wanted. Was it?
I think [the NAD challenge and lawsuit] are two separate issues. Regarding trade secret litigation, you are right. I won’t go into too much detail other than to say that I think competition is a good thing, but it should be ethical. We do not believe it is ethical for employees to maintain access to trade secrets while employed by a competitor. So, of course, we’re going to fight this vigorously and get the findings that will allow us to properly assess what actually happened and the impact it had. I won’t say anything more about that.
When it comes to the NAD process, at its heart was CoStar selling audiences to its customers based on deceptive and misleading claims that the customers had access to audiences they did not actually have. That’s what it meant. access. We highlight that they have aggregated 17 different URLs and claim that it is Homes.com’s audience, and customers visit 16 other URLs that are not Homes.com. We provided an opportunity to encourage people to search. branding they paid for [and] When I look for the supposedly advertised listing, I can’t find any of those 16 URLs.
We know the battle for traffic will continue, especially heading into 2025. Speaking of 2025, I would like to briefly discuss what the competitive environment will be like next year. The industry is still working through the initial pain of collaborative compensation changes, and portals are playing a key role in helping agencies adjust. What do you think Realtor.com has done better for agents over the past few months, and what opportunities do you see for Realtor.com to do even more?
We hold a unique position within the industry, being alongside and for the industry. Our company was founded nearly 30 years ago by the National Association of Realtors, and that legacy is in our DNA. it’s not a marketing slogan [and] Our actions should speak louder than words. So I can say I’m most proud of the work we’ve done to truly champion the industry through our Buyer Agency Campaign.
When one of our competitors was infringing on a buyer agent’s proposal, we held our heads high and didn’t talk about the industry bubble. We spoke outside the bubble with consumers, legislators, regulators and politicians. We argued that buyer agents provide a very important service to the community, a unique service from a global perspective, and that it should be supported by legislators and the community at large. .
We are supporting this campaign with not just the industry, but approximately 30,000 agents and brokers; [multiple listing services] They are downloading the toolkit we provided to spread the message in their own communities. That’s probably what we’re most proud of.
I reported on the buyer agency campaign, and based on conversations I’ve had with others about it, I agree that it was a standout part of Realtor.com’s year. So what about the jobs that still have opportunities to be done? My brother and several other people I know are currently in the process of buying or selling a home and are very anxious about what will happen next in the housing market.
Our suggestion to consumers is to go where the professionals are. We are the #1 most trusted company by real estate professionals, and we strive to reflect that in our message to consumers. Our site has done, and will continue to do, a lot of work to communicate what a professional real estate agent can offer both when selling and buying a home.
Our buyer agent advocacy campaign shines a real light on 111 reasons to hire a buyer agent, and the second iteration of that campaign is digging deeper into specific issues related to underrepresented and disadvantaged communities. I tried.
For example, when purchasing a home as a veteran, there are various provisions to be especially aware of, and a purchasing agent can play an important role in highlighting these provisions during the purchasing process.
The next area we think there is an opportunity to focus on is housing affordability. I think we foresaw next year’s actions on the housing affordability front on Election Day by running full-page ads calling on future politicians to pay attention to the housing affordability crisis that exists in America. .
We have been concerned with fee issues related to housing affordability, but to demonstrate that the fundamental issue affecting affordability in this market is the supply of housing. I’m going to do a lot of work in the new year. There is a housing shortage of approximately 7.2 million units in the United States. If these homes had been built, planning and regulatory approvals had been expedited, and the new home construction industry had been properly incentivized, we would not have the affordability crisis we have today. .
I would like to focus on that in the new year.
I’m a millennial, and our generation in particular has struggled to overcome affordability issues and other market headwinds. I think legislators on both sides of the aisle agree that housing affordability is an issue, but given the current political climate, Republicans and Democrats at the federal, state, and local levels need to work together to solve it. I think it will be more difficult to work on strategies. Given your unique position in the industry, how can Realtor.com bridge the gap and help pass meaningful housing legislation?
We are cautiously optimistic that solutions are within reach. Again, I think there is bipartisan support for the recognition that there is a housing affordability crisis in the United States. No politician I’ve ever talked to would deny that this is a real problem and probably one of the biggest problems facing communities across the country, so we is cautiously optimistic that bipartisan solutions are within reach. These problems. But as you rightly pointed out, that requires change at all levels of government.
At the federal level, that could mean controlling inflation and creating access to federal land for new building development. But at the local government level, it will likewise mean dealing with the red tape that places a huge burden on new construction.
The average cost of a new home is about $400,000, but the average compliance cost for planning and developing that home is closer to $90,000. This puts a huge strain on the affordability of the 7.2 million new homes that need to be built.
In addition to affordability, what other trends are you looking at in 2025? Clear cooperation is a current topic, along with continuing issues related to cooperation compensation. How do those things factor into your strategy for the new year?
Clear cooperation has been talked about a lot lately. Evolving policies is important to keep up with the changing needs of consumers and real estate agents. But what I’m saying is that we need to be careful not to throw out the baby with the bathwater. Clear Collaboration and MLS systems in the US ensure that buyers and listing agents don’t have to pay to advertise a property, and on the other side of the transaction, sellers can attract more buyers. to ensure maximum exposure for your listing. and attract higher prices. It is a system that other countries envy.
I don’t want to see the world of real estate listings more similar to the TV streaming services that exist today. It’s a fragmented world where consumers are regularly frustrated by having to access multiple streaming services to find the content they want, and in fact, it’s the basis of how we watch TV today. This is the most frustrating aspect of streaming, and the reason why most streaming companies are trying to aggregate their content. Don’t compartmentalize.
But to fully answer your question, we are paying very close attention to artificial intelligence, the benefits of that technology, and what it can bring to the digital real estate market. While digital real estate searches have remained essentially unchanged for 20 years, this new technology not only offers new ways to search, but also new ways to present homes. Therefore, we believe that the future will bring significant new benefits to consumers and customers.
Email Marian McPherson
