You may not know that Streeteasy is shifting its focus on March 1st.
Their relationship with brokerage agencies will become more adversarial, and buyers will have less transparency this week.
In the rest of the country, if you’ve ever looked for a house, be it in the Hamptons, the North Fork, Florida, or elsewhere, you may hop on Zillow, Trulia, Redfin, House.com or other popular portals.
Connected to every house you look at, you will be greeted by a host of agents’ faces and contact information.
Those agents have paid advertising dollars to have their contact information there.
At that point in your search, if you want information on the house, you aren’t sure who the person is who is actually representing the sellers. It is confusing, as a homebuyer.
That is coming to Streeteasy.
Here are a few things that I have learned in 15 years as an agent about buyers and sellers.
I have some concerns that this shift in NYC’s most popular real estate portal will not help buyers or sellers very much.
Specifically, the lack of transparency inserted into the buying process will likely be annoying and confusing in many instances.
What I’ve Learned About Buyers (well, a portion, anyway):
- Buyers will want to be represented by an agent and in almost every case, a buyer agent is able to add value to a buyer’s search.
- Buyers also in many cases do not know what they do not know.
It’s not that a buyer thinks that he
“knows it all,” but has been empowered in so many instances with so much information, that there is a growing sense that everything is there to see and learn.
- Agents face a trust hurdle working with buyers.
A Trust Hurdle? What I mean is that buyers have gotten increasing defensive, even cagey these days.
My feeling is that it does come from the lack of communication, face-to-face communication, with buyer-side agents.
Trust comes from contact, from visits, from knowing that the buyer agent has a buyer’s best interest at heart.
I don’t know that a
random agent’s face on another agent’s listing will build trust, or just make an agent look like another person hunting for business.
- Of course, buyers want to pay the lowest price possible and find a great house, in the least amount of time required to feel educated in the marketplace.
But they also want advise, especially in a competitive marketplace with bidding wars.
- If buyers think that going directly to listing agents may save them money – and they do- they want the opportunity to potentially take that road.
- Buyers also want to have access as early as possible to new listings, access to “off-market” deals, and that access rarely comes through the random buyer agent.
What I’ve Learned From Working With Sellers (Quite a Lot):
- Sellers want to sell their apartments at the highest price.
- Sellers also think that their property could and should outperform the market.
What I mean is that usually sellers feel that their home is special, which makes some sense, and should sell at a higher price than the market will bear.
If they bought that house, isn’t there something amazing about it?
Usually, there are lots of special things.
Whether that translates to a special price remains to be seen in each situation.
- Sellers are, at bottom, really are looking for results, which means selling as quickly as possible at the highest price with as little stress as possible.
So, it’s not that they don’t care about what the apartment marketing looks like on a website, but they care more about it selling than anything else at the highest price.
- Sellers also like to do their own research to gather what their apartment is worth before going to market or meeting with agents.
Transparency to see which agents do a lot of business in their neighborhood is critical to that work.
like Streeteasy have a lot to offer.
A terrific, best-in-class interface for buyers and lots of transparency- to date.
Sellers like that there are lots of good marketing options for their property that showcase great photographs.
- Listing agents promise massive exposure to their sellers, so the value proposition sellers are expecting must be compelling.
I can guarantee that there is much more beside putting a property online.
Apartments do not sell themselves, generally speaking.
Marketing and getting a buyer over the finish line goes well beyond a website.
- Coops- Sellers want to make sure that their Cooperative Board approves their buyer.
Exposure brings in bodies, but not always qualified buyers.
And thus far, one of an agent’s skills, on the buyer or seller side, lies in ascertaining the best way to present a buyer to a coop board.
How Streeteasy Makes Money
While access to listings has always been free for buyers, for a very small monthly fee, buyers and sellers can access historical pricing and closing information through a very clean interface.
Additionally, I should at this point tell you that Streeteasy has had lots of opportunities for buyer-side and listing-side agents to advertise on their site, and to access the same information as mentioned above.
For someone like me that sells a great deal in specific neighborhoods like the Upper West Side, spending advertising dollars to promote that seems logical.
Advertising on the most popular aggregator makes sense in that buyers want to work with people who know the market, as do sellers.
Being a PRO Agent on Streeteasy has been a smart move, given that the experience and prior results back up the designation (and advertising cost).
I have certainly seen direct results from the add-on advertising, which goes beyond having my name on my listings. I would also suspect that there are indirect results from buyer and seller exposure from that advertising.
But Here Are My Concerns with the Change:
Do buyers benefit with the change?
That is, does this solve for getting a better deal?
Do they have better access, more transparency?
Does this change help build buyers’ trust in the sales process.
I do not see it.
Will Buyers Get Better Deals?
First, I’ve written at length that I do not believe that adding competition at the listing level on their site will help them get a better deal.
If buyers feel that contact with the listing agent directly, even if they end up working with a buyer agent, helps them, this muddies that process.
There has always been competition, with so many New York City agents.
Given that there have been 5-6 new entries into the brokerage market, there’s no question that competition is fierce and that regular market forces of expansion, consolidation, and market disruption are all at work.
I really just wonder if this add-on advertising is nothing more than added noise to the website. Which brings me to my next point.
Having a qualified point person to run a buyer search builds trust in the sales process.
Not only must buyers have faith their their agents are representing them sell, but it works the other way.
We work very hard to build trust with the buyers that we work with.
Obviously I think that buyers benefit from working with buyer agents.
I can go down the list of different ways in which I have added value in many of these cases.
Most of them are interesting stories.
From getting my clients in before property comes to market, relationships with listing agents outside my firm, access to off-market properties through property owners.
These are all wins for a buyer who is working with me.
AN Add-On, Not the End-All
Streeteasy as an add-on to my work with buyers, and a terrific marketing resource for sellers.
I actually send listing links from the site directly to clients, as it’s often more efficient.
In essence, I am often meeting buyers where they are conducting their search.
It’s a wonderful add-on, but as of yet I don’t see it as a fully trustworthy source of information.
What I mean is that the site is still rife with misrepresentation.
We report fraudulent listings on a regular basis, incorrect listing information, outdated listings, and listings that serve the purpose of “fishing” for buyers, once they are already in contract.
It’s the trust that I’ve built with buyers that allows me to feel good about sending those links directly, because they know that I’ve vetted the information.
I don’t know how Streeteasy solves for quality control other than having the full cooperation with the listing brokerages.
These changes set up a lot of confrontation with the important sources of information they need as life blood.
Unfortunately, there is not a Multiple Listing Service in New York City, which is sad.
But at this point, I cannot envision an interface that would be anything but horrible.
Private companies have designed interfaces that are far more preferable, in a market that is so large.
Buyers have preferred to use Streeteasy because it’s just easier to use.
It’s all about UX, user experience.
Further, access to listings is far more complicated than anywhere else.
Listing agents meet buyers at every showing.
There is no “lock box” on an apartment building, and not every buyer is qualified to buyer every apartment.
There is a vetting and security process that every inquiry goes through before a showing is arranged.
Built-in safeguards are important in New York City.
The information break-down will happen very quickly, and seems to just add layers of communication to arranging a showing.
In The End
The buyer agents who do a ton of business will continue to do a ton of business.
Relationships matter in this business, and advertising also matters in this business.
And I suppose that as these changes roll out, if buyers get better representation, that is good thing, even if it’s accidental.
But my experience doesn’t bear out that buyers will like the change.
Of course no one knows how it will all shake out, but I’m very curious to see how it’s going to change the buyer-side of the business.
It seems like another attempt at the company to pull more advertising dollars- and may open up the door for other websites to become popular.