The deal was announced Monday, July 28th and is set to close next year. Zillow's cheif executive officer, Spencer Rascoff, maintains that both sites will retain their separate brands and web presences. Investors are happy and consumers are not yet drastically impacted; however, agents have another story.
While many agents accept these online sites, others do not support them. For example, some agents disagree with Zillow's "Zestimates," claiming that they inaccurately portray home values. However, the merger leaves little bargaining power for disgruntled agents. Bradley Safalow, Founder of PAA Research in New York, warns against Zillow increasing agent advertising costs, noting that some brokers may take their listings off of third party sites all together in an attempt to increase traffic to their own webpages and reduce advertising expenses. Indeed, gaining a larger advertising share is the primary motive behind this acquisition--Los Angeles Times cites that $12 billion is spent on real estate advertising each year. Sissy Lappin, founder of ListingDoor.com, claims that Zillow seeks only to buy out its competition, not improve information accuracy. While neither Zillow nor Truila is profitable yet, Zillow hopes to save $100 million annually by cutting repetitive costs. It will be interesting for all parties involved to see how this deal changes the real estate playing field.
