The New York City Real Estate Market is unique for many reasons – including the absence of an MLS system. Although there are differences of opinion as to whether the New York market could embrace a multiple listing service of some kind, few would disagree that StreetEasy.com has become the most popular alternative, and a benefit to both consumers and brokers in NYC.
Why? StreetEasy does a great job at providing a transparent, current and accurate view of residential sales availability in NYC (primarily Manhattan and Brooklyn) free of charge to buyers and – until recently – offered users an easy to navigate and straightforward experience. In my opinion (an opinion not shared by all agents), StreetEasy provides a benefit to agents as well. Since more “eyeballs” are on StreetEasy.com than any other listing service in NYC, agents understand the necessity of posting their listing on StreetEasy to ensure maximum exposure. Therefore, an overwhelming majority of agents in Manhattan and Brooklyn (Queens still struggles unfortunately) voluntarily post their exclusives on StreetEasy.com, making it a very comprehensive database.
Unfortunately, StreetEasy recently announced a change which is likely to jeopardize their relationship with their users (buyers and brokers alike). They are officially joining the likes of Trulia and Zillow (StreetEasy’s parent company) by offering a “Premier Agent” program – a pay-to-play opportunity for real estate agents broken down by zip code. For a price, StreetEasy helps “Premier Agents” capture customers from other agents’ exclusive listings by directing users away from the listing they are viewing if/when they fill out the “Contact Agent” field on the right side of the listing. Why would they want the lead the buyer away from the listing to which they are expressing interest and the agent who posted it? The simple answer is money. According to a February article by Katherine Clarke in Real Deal, 71% of Zillow’s income in 2016 came from their Premier Agent program.
So, how does the “Contact Agent” field work and why is it misleading to the user? One would assume, when visiting an exclusive listing on StreetEasy (or any site for that matter), that providing their information in a “Contact Agent” box would direct them to the person who has the best and most accurate information – the listing agent. However, this is not the case with the new “Contact Agent” field. In fact, under this new version of the listing page, the user will be randomly assigned to one of the paying Premier Agents who will presumably offer the buyer the chance to be represented by them if they want to view that apartment.
StreetEasy argues that buyers deserve the opportunity to be represented and this new system provides them that opportunity. If you are a reader of my blog, you know I am a HUGE proponent of buyers having representation when purchasing an apartment – but I believe they should choose that agent based on expertise and merit, not through a potentially deceptive button or form on StreetEasy. If StreetEasy were giving the user a clear and transparent choice of contacting the listing agent or a buyers’ agent not associated with that listing, that would be different. That would be the transparency I would expect from StreetEasy and would provide a potential benefit to the buyer. After all, many buyers would (and should) like to have an agent help them ask the right questions and give them a objective view of the listing details, questions they might not be willing or prepared to ask on their own. Unfortunately, this is unlikely what the buyer is expecting when filling out the “Contact Agent” form and has the potential to upset and frustrate users trying to go straight to the “source”. Additionally, sending buyers to an agent with little or no knowledge of the listing to which they are inquiring allows the agent they are placed with the opportunity to divert the buyers’ attention to another listing the agent would rather show them because they know more about another listing or earn more on another deal.
I understand that StreetEasy is making this decision in order to make the site more profitable and I don’t blame them for focusing on the profitability of their site. I think buyers, sellers AND agents benefit from the existence of StreetEasy and I, for one, want them to continue to play an important role in making the market transparent for consumers and their users. That said, I firmly believe this is going to do damage to their brand and will frustrate buyers who expect a level of transparency they unfortunately don’t believe they get from the brokerage community.
My hope is that consumers speak up and demand an easy to follow page which makes it clear when they are being directed to the listing agent and when they are being directed to a broker paying for advertising.