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There’s always something to howl about

Zillow.com cultivates its garden with ten million new database records, improved home valuation algorithms and the adoption, with Trulia.com and other Realty.bots, of a RETS-compatible listings standard

First the news on horseback. We’ll come back and gloss it again, but you’re likely to learn more by listening to the podcast linked below with Zillow.com’s David Gibbons.

The news, from Zillow’s press release:

Real estate Web site Zillow.com today announced a major expansion and upgrade to its database of nearly all homes in the country — increasing data coverage from 70 million to 80 million U.S. homes in 48 states, or 88 percent of all homes in the country. Zestimate values are now available on three out of four U.S. homes, or 67 million, up 68 percent from when Zillow launched in 2006. New areas with Zestimates include the states of Alabama, Arkansas, Delaware, Iowa, Idaho, Indiana, Kansas, Kentucky, Louisiana, West Virginia and New Hampshire.  

Zillow today also announced it has dramatically expanded and improved its Zestimate algorithm, incorporating 20 times the number of statistical models than before that factor in more local and home-type variables and now integrate homeowner-edited home facts — such as the number of bedrooms, bathrooms or square footage. More than one million homes have been claimed and updated by their owners to date, contributing to improved Zestimate accuracy on many of these homes. Incorporating these changes along with continued algorithm upgrades have resulted in a 12 percent improvement in Zestimate accuracy nationwide. Many larger metropolitan markets, such as the greater San Francisco, Miami, Los Angeles and Atlanta areas, have some of the most significant accuracy gains at 18 percent, 21 percent, 22 percent and 28 percent respectively.

There’s more. This was leaked earlier this evening by TechCrunch.com:

The other big news is that Zillow is joining Yahoo Real Estate, Trulia, Oodle, Homes.com, Realestate.com, Vast.com and others in adopting a standard way for brokers and multiple listings services (MLSs) to send in their real estate listings in a feed format. That way brokers can use the same data format for all the different real estate search engines and Websites. It is called the Real Estate Transaction Standard (RETS). That should make it easier for brokers to propagate their listings everywhere. [*See clarification from Zillow’s David Gibbons in the comments below.]

This agreement, presumably brought about at the instigation of FBS Systems President Michael Wurzer, who last week wrote an open letter to the nascent Realty.bot industry to adopt the RETS standard, is expected to be formally announced at 8 am EST Thursday morning.

Locking down the news of the data-sharing agreement is funny, almost a parody of corporate behavior. When Michael Wurzer made his initial proposal, you could hear the chorus of “D’ohs!” nationwide. And while there is always a gap between dictum and factum, RETS is an eminently XML-able data standard, and all of the Realty.bots are already set up to eat XML. The upfront, one-time cost of revising a parser in exchange for an almost-infinite extensibility could not have required a lot of thought.

I bugged Michael Wurzer for a comment, and he offered this: “Standards produce more value the more they are used, and so we’re thrilled by these firms adopting standards for syndication to their sites. Brokers will have more choice and more efficiency, which is the core purpose of standards.”

Not everyone is as thrilled. We in Phoenix are about to adopt an FBS Systems MLS system, and Michael has already asked us if we would be interested in having our listings made available to Realty.bots like Zillow.com and Trulia.com, as well as listings aggregators such as Postlets or Oodle. I could not be more enthusiastic about this prospect, since I would be creating and maintaining one canonical record, with every other form of that record being derived from the original.

But I talked to an agent with a very large, very powerful brokerage tonight who worries that making data aggregation and dissemination easier at the brokerage level will end up costing Realtors money. “Instead of hand-tailoring my listings on Zillow, with my copy and my photo, my brokerage will be there with their contact information. Any leads will come to them, and some relocation company will be in a position to sell me back my own listing.”

In the podcast, you’ll hear David Gibbons talk about all the ways that Zillow has worked to improve the accuracy of Zestimates — better data sources, selecting more-nearby and more-closely-correspondent comparable homes, using the data supplied by owners and listing agents with respect to particular homes. The addition of ten million new homes is almost a side-effect of this effort. I myself have never been a Zestimate fan — very much the contrary — but clearly there will come a day when close enough is good enough — when the marginal cost of disputing a Zestimate will exceed that dispute’s marginal value. In the podcast, we talk about transactions where this must already be the case — where the cost of obtaining an appraisal would exceed any possible difference between the appraised value and the Zestimated value.

Even so, I don’t care. I have never yet had a client show me a Zestimate. It’s the rest of what Zillow does that is fascinating to me, and I confess that Zillow is as fascinating as an ant-farm to me: I just can’t tear my eyes away from what they’re doing. Like this:

Unlike most real estate sites, Zillow provides data, information and community features around all homes, not just those on the market today. In fact, 40 percent of all U.S. homes have been searched on Zillow since the site launched in “beta” form in February 2006. With this latest release and round of improvements, Zillow now comes out of its “beta” phase.

I had brutal fun at Trulia.com’s expense yesterday morning, and I don’t want to come off like I’m playing favorites. And I’ve given Zillow a lot of grief in the past, and no doubt I’ll be doing that again. But where Trulia seems to me to be striving to be the TV Guide, Zillow has within it the potential to be television itself, The Show, the all-encompassing everything. They understand the Cluetrain idea better than anyone, absorbing criticism with aplomb and using it as the fertilizer from which to cultivate their garden. Second Life is a toy. Trulia feels like a toy to me. Zillow is building a correspondent on-line avatar for everything that matters in residential real estate. In the long run, I think they will end up defining the virtual real estate world.

 
More: The press release from the triumphant triumvirate announcing the new uniform listing standard for Realty.bots and listings aggregators:

Leading online real estate companies Yahoo! Real Estate, Zillow.com, and Trulia.com today announced the adoption of a new standard data format for the distribution of real estate listings online. With this standard, real estate franchisors, brokers, multiple listings services, and other listings providers will be able to distribute their listings data to several of the leading real estate sites in one common format, making it easier to get critical information to consumers faster and more efficiently.

[…]

In addition to Yahoo! Real Estate, Zillow and Trulia, several other leading online real estate sites have agreed to adopt the standard, including Homes.com, Homescape, Oodle, Point2 Technologies, Realestate.com, Vast.com, and vFlyer.
 
[…]
 
The companies participating in the new standard will work in close collaboration with the Real Estate Standards Organization to ensure that the data specification interoperates with the Real Estate Transaction Standard (RETS).   

[…]
 
The data feed specification will be based on the XML format and will comprise all the requisite components of a listing, such as address, price, square feet, beds, baths, and additional descriptions of the home.  Where as today, brokers and listings providers would need to create upwards of a dozen different formats for one listing, the new standard model will significantly reduce the amount of time spent preparing the content for distribution online.
 
[…]
 
The participating companies plan to launch the standard feed format later this year. Brokerages and other listings providers interested in participating in this standard should contact the following: feedstandard@yahoo-inc.com.

 
Further notice: John Cook, TechCrunch, Jay Thompson, Jim Duncan, Kris Berg, Lloyd Frink, Tom Royce, Mike Price, Peter Chiu, Search Engine Land, Joel Burslem, Thomas Johnson.

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28 comments

28 Comments so far

  1. Dan Sullivan January 9th, 2008 11:04 pm

    As much as I think this will hurt Real Estate agents in the long run, I have to admit this is a good thing. I am proud of Zillow for getting their act together.

    The reality (and you speak it every day here) is that the job of a Realtor is nothing like it was ten years ago, and only a little like it was three years ago. Buyers and sellers will have the ability to connect with eachother like never before, creating a more efficient market. Agents will have to work in creative ways they never imagined if they are going to survive.

    I don’t think that people understand that regardless of the available information, the typical real estate transaction will remain complicated. The “parts” of a real estate transaction will be separated out, as sellers and buyers attempt to handle the different aspects of the transaction on their own, for instance, on a sale:

    Staging Advisor: $x
    Marketing Company: $x
    Marketing Materials: $x
    Showing Coordination: $x
    Inspection Advisor: $x
    Legal Advisor: $x

    And so on……

    After a few years of this new market and some legal blowouts, the market will yearn for that human touch, and the expertise provided by a professional. $x + $x + $time + $grief will add up to a pretty hefty number. And maybe, just maybe, someone will say:

    “Damn…I wish I could find someone to handle all of this for me!”

    I hope I’m still around, and not busy designing algorithyms for Zillow.

  2. David G from Zillow.com January 9th, 2008 11:17 pm

    A minor correction; RETS is not the standard listings distribution format. We have however partnered with the RETS group to ensure that the listing standard will be fully interoperable with RETS. We’re excited to develop a good working relationship with the RETS team and full credit goes to Michael Wurzer for taking the initiative to explore this opportunity with us.

    I’ve posted this correction on TC and sent you more details. Sorry for the confusion.

  3. Jillayne Schlicke January 9th, 2008 11:26 pm

    Zillow is the only company in the running that has the potential to become a national MLS. From the outset, they started not with listings but with public records data.

    With real estate in the national news on an hourly basis now, I’m sure that will drive some homeowners back to zillow to see if their zestimate adjusted downward. Bingo: More ad revenue sales.

    Ask any random homeowner in the Seattle area what their zestimate is and you will get an answer.

    Ask any random homeowner what the Northwest MLS is and you will probably not get an answer.

    I should probably spend more time there. Instead, I’m reading all the cool mortgage and real estate blogs. Now I see their “discussions” forum. This looks like it holds lots of potential to connect consumers and realtors/mortgage people. It’s a blog that’s read by more than just real estate people. 🙂

    So how about a national mortgage information network for consumers? Would that be next?

  4. David G from Zillow.com January 10th, 2008 12:04 am

    Dan – with that level of insight I have strong suspicion that you will absolutely still “be around.” Great comment, thanks.

    Jillayne – mortgages ARE next but I unfortunately can’t go into detail. Watch this space. I’m glad you’ve found Discussions! The current market drives some heated debate in there but don’t be shy. It’s an awesome place for an RE pro to get a glimpse into the mind of their customer. (Kind of like AR is for us ‘vendors’)

  5. […] isn’t at Inman, but David Gibbons at Zillow called Greg after talking to us, and Greg has a typically thorough overview of the “new” Zillow. No real need to re-hash the gist of it here, go read the Bloodhound post for […]

  6. Jay Thompson January 10th, 2008 12:23 am

    David – is the Inman News report about Zillow getting listing feeds from Prudential CA/NV/TX and NCI the “partnership” you alluded to?

  7. Jay Thompson January 10th, 2008 12:24 am

    Jillayne asked “So how about a national mortgage information network for consumers? Would that be next?”

    Well, there is something up at Zillow with mortgages. What it is isn’t clear. Yet.

  8. David G from Zillow.com January 10th, 2008 12:30 am

    Jay –

    We have a lot of news this week; I totally forgot to mention NCI. I was actually hinting at the listing data standards initiative and our partnership with Yahoo! et al. More details about that initiative will be posted on our blog later this morning.

    Good night, sir!

  9. Michelle DeRepentigny January 10th, 2008 12:39 am

    I’m excited. Zillow is both an incredible resource of information and an excellent listing tool for me. Congrats on the next step!

  10. CJ, Broker in L A, CA January 10th, 2008 4:50 am

    What needs to happen now is for Greg (or Cameron) to build an easy feed creator tool.

    Agent or assistant fills in simple data fields on a form; tool generates properly XHTML coded feed.

    I’d be happy to pay for such a tool.

  11. Jay Thompson January 10th, 2008 6:17 am
  12. Zillow might be right(er) | Real Central VA January 10th, 2008 6:45 am

    […] Much, much more at Bloodhound. […]

  13. […] posts: Zillow cultivates their garden… Bloodhound Blog Bye Bye Beta… Phoenix Real Estate […]

  14. Joe Dallorso January 10th, 2008 7:19 am

    I’ve been avoiding participating in sites like Zillow figuring it’s like shooting myself in the foot. In the short run I think it could be good exposure and I suppose a big change in the way real estate is done is inevitable any way.
    So I went to Zillow & plugged in a listing that isn’t moving which I have priced at $165,000.00. Low and behold I never realized what a steal this listing was as Zillow estimated (zestimated?) it at $296,000.00 !! I guess they still have some work to do but I can see that when they get their act together the world will be different.

  15. […] Bloodhound A ton of information […]

  16. Greg Swann January 10th, 2008 9:04 am

    > What needs to happen now is for Greg (or Cameron) to build an easy feed creator tool.

    We already have something like this, but it works from a downloadable format from our MLS. This seems like more fun to me than entering data into a form.

    > Agent or assistant fills in simple data fields on a form; tool generates properly XHTML coded feed.

    But this is very doable. Are Postlets or Oodle already doing something like this?

    > I’d be happy to pay for such a tool.

    I know Cameron has plans for Realtors. I’ll see if he’s interested in this, as well.

  17. David G from Zillow.com January 10th, 2008 9:25 am

    “Are Postlets or Oodle already doing something like this?”

    Postlets and Vflyer are both integrated to Zillow; listings posted to either service will be on the site (and more) within 24 hours.

    “I know Cameron has plans for Realtors.”

    What I’d love to see is a structured blogging plugin for wordpress that would generate an RSS listing feed (very do-able.) With this tool you could just post your listings to your WP blog using the predefined structured tags and they’d be instantly syndicated everywhere.

  18. CJ, Broker in NELA, CA January 10th, 2008 10:55 am

    >What I’d love to see is a structured blogging plugin for wordpress that would generate an RSS listing feed (very do-able.) <

    That would be great – Altho we use VFlyer and like it very much – I’d like something I could personally control.

  19. Thomas Johnson January 10th, 2008 12:06 pm

    This is wonderful Zillow news. As a pretty lame technologist, I can only translate this into an item on my to-do list: Now that Christmas decorations are down, it is time to get the Zestifarming done, and muy pronto. The pics will look better in the Spring, but the drive-by photographer is busy then.

    By law, we in Texas do not disclose sold data publicly, so Zestimates will always have some inherent inaccuracies. As the neighborhood zestifarmer, that is a discussion I would love to have with sellers!

  20. […] I’m a little late to the party on this one. […]

  21. Chicago Real Estate January 10th, 2008 1:42 pm

    Here’s an idea for Zillow and the other “bots”.

    For each listing a REALTOR (or I suppose a broker, since we have designated agency in Illinois), provides for them to build their business on, they pay that REALTOR or borker $500.

    That seems fair.

    We do the work, shell out the money for marketing and take on a ton of risk, and they take the data generated from that work for a fee.

    Maybe they should even be required to get permission from the sellers to post their property data and/or the photos of their home. As an agent/watchdog for my clients, whose interests I represent, I’d rebate the the $500 to them as a way of saying “Thanks for your business.”

    And since virtual tour providers actually own the copyright to “your” virtual tour photos, maybe they need to pay a fee to them, too.

    I’m sure they’d rather have everything for free, but I’d be willing to listen to a counter-offer.

  22. David Harris January 10th, 2008 2:42 pm

    RESO has made every effort so far (initiating most of them) to reach out to GZTY to understand their needs for a “standard listing distribution format”. Anyone who states that RESO cannot or will not discuss modifying the listing schema to accommodate their needs, has not approached the RESO Board. In my opinion, RESO has not been given the chance to evaluate GZTY’s requirements for incorporation into the standard, if they do not already exist.

  23. Heather @ Trulia January 10th, 2008 3:30 pm

    Hey Greg – we appreciate your analysis and will continue to work to prove to you, agents and consumers that our strategy is the right one.

    One tidbit worth mentioning is that Trulia is now ranked #7 in the real estate category according to Comscore (chart is at the bottom of the techcrunch piece); their numbers put us above Zillow in unique visitors! We’ve taken a slow and steady approach to growth and now with 2 million+ listings and an active (and growing) community with Trulia Voices, we expect 2008 to be a very interesting year!

  24. […] Swann at Bloodhound has an indepth overview with comments from Zillow and […]

  25. Andy Scherer January 10th, 2008 9:02 pm

    I have to say this it’s about time Zillow made this move. They have been getting pounded with criticism for quite some time (at least in my area). I am definitely looking forward to seeing the new “algo” in place. Thanks for the great information!

  26. Beth Mergens January 11th, 2008 9:41 pm

    I’m just a lowly real estate agent commenting on the gods of my universe. The peasants look to Zillow for information but have found accuracy is lacking. Perhaps this conspiracy will lead to some knowledge for the masses but I fear more frustration for those who lead the masses.

  27. […] of Zestimates, dropping beta, etc.). Joel doesn’t write much about of the improvements, while Greg quotes it extensively and seems to gush about their RETS announcement, which even the Zillow team pulls back from in the […]

  28. 360Digest » Lifestyles of the Rich and Zesty January 16th, 2008 2:23 am

    […] As fascinating as an ant-farm These icons link to social bookmarking sites where readers can share and discover new web pages. […]