30 August 2006

Yahoo Shakes Up Real Estate

By: James A. Warholic

Yahoo, having partnered with Prudential Real Estate a couple of years ago for real estate search, has now added the controversial Zillow property comparison to their website.

With the revamping of Yahoo Real Estate, Yahoo has given greater prominence to their property search tool. This now shows up whenever someone does a search in Yahoo Search for city searches like: San Ramon Real Estate.

Several questions need to be asked.

What does this mean for the consumer?
What does this mean for the Realtors and real estate Brokers?
Is this going to help or hurt the real estate industry?

Yahoo Renovates Real Estate
by Mark Walsh, Wednesday, Aug 30, 2006 6:00 AM ET
AMID A HOUSING SLOWDOWN, YAHOO has revamped its real estate section by adding new features including current U.S. home valuations, interactive mapping and local search.

The redesigned Yahoo Real Estate offers access to more than 3 million home listings, chiefly through Prudential Real Estate, and comparative information on some 50 million homes from Zillow.com.

From a consumer standpoint, having home search information, maps, and other local information at your finger tips is great for the consumer. With the ability to save searches, although registration is required to use these options, home shoppers can get automatic email updates, save different home searches, and store properties to watch. The home comparisons from zillow.com has been controversial from its inception. Using a automatic algorithm to do property comparisions in the local areas, Zillow displays comps for a large number of addresses across the United States. Realtors and property professionals have evaluated the tool and have determined that many times the results are not a true indication of the property's value. Homeowners who use this to try and place a value on their own property may be under-estimating or over-estimating the property's worth.

Realtors and other real estate agents who are paying for Yahoo Online advertising are now in direct competition with Yahoo for home searches. While Yahoo does not yet place the property search tool at the top of the search results page, the search results pages for properties in your area look like a page filled with ads. The natural or organic search results are buried below the fold. Yahoo currently is displaying four paid ads at the top and another eight on the right side. This is not by accident. I am sure they have a carefully thought out game plan to maximize the amount of advertising revenue generated. However, with this major addition to Yahoo, the conversion for ads is likely to be diminished for all ads across the real estate search board. If you are running Yahoo ads, it would be wise to study your conversion rates. How many clients are you gaining on Yahoo vs Google or MSN advertisements.

With the real estate market being in a slow down at the moment, I wonder how all this is going to play out for the industry in general.

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