Realtor.com CEO takes aim at ‘deceptive’ claims 

Editor's note: Real Estate News presents "Deuces Wild," a three-part series on the high-stakes battle to be the second-largest home search portal, featuring exclusive conversations with Realtor.com CEO Damian Eales and CoStar CEO Andy Florance.

Since being appointed CEO of Realtor.com last June, Damian Eales has been standing firm — and firing back — against the competition in the home search space while also navigating the quickly evolving residential real estate business in the wake of the NAR settlement. 

In an exclusive interview with Real Estate News, Eales said he welcomes competition but takes issue with what he sees as unfair — and even dishonest — claims from CoStar and Homes.com. He also shared his views on dual agency and discussed Realtor.com's strategy to grow its audience, traffic, and ultimately, agent leads. 

This interview has been edited for length and clarity. 

Realtor.com is trying to boost its visibility by partnering with other News Corp properties. Can you discuss how the most recent campaign came about?

We are heavily leveraging News Corp to drive traffic to Realtor.com. To be clear, unlike others, we're not counting traffic on other URLs and claiming it as Realtor.com. We're driving traffic.

An example you'll see is Realtor.com partnering with the New York Post to write articles that are focused on individual athletes who are drafted to alternative locations and discussing the property they might sell or buy. Ultimately, real estate is an entertainment category, and we think this is a great way to leverage the media and entertainment assets we have in News Corp. 

We will also be running an enormous amount of advertising across the News Corp network. We're running ads in the Wall Street Journal that talk about our value proposition and about the benefit of buyer agency.

You and Zillow CEO Rich Barton have taken a public stand against dual agency and for buyer representation. Does Homes.com's "your listing, your lead" model lend itself to dual agency?

I think Homes.com has to be very careful here because it could well be perceived as encouraging agents to double-end a deal at the expense of independent representation for a buyer. And that comes with significant risk that not only will consumers not be protected, but actually agency fees could grow — the one thing that the government is targeting to reduce.

Fundamentally, we don't have a problem if consumers choose to work directly with a listing agent. That's not a concern of ours. We have had "your listing, your lead" products historically and we would consider having them again, but we would do so in such a way that consumers really knew who they were talking to and understood the benefits of independent representation.

What's your response to people who say Realtor.com and Zillow are taking this position on dual agency solely because they view Homes.com as a threat?

Let me be very clear: Zillow is my number one competitor. They have a dominant advantage on a number of fronts. We are catching them from a market-share perspective on a number of fronts as well. And by the way, if this country went to "your listing, your lead," Zillow would be the most successful under that format because they have a larger audience — significantly larger than Homes.com in particular. 

We are pro-buyer agency because we think the American model is better than other models around the world since it gives protection on both sides of the transaction. I'm not saying it's a perfect model. We have welcomed the improved transparency, competitiveness and professionalism that has come with recent events.

We think reducing commissions at the expense of independent buyer representation would be a cost that is too great for society to bear. A lot of Americans already know this — because America fought for those same consumer protections in the 1990s — and indeed, eight states in America went so far as to prohibit dual agency.

You've said you welcome competition and it can lead to a better result for consumers — but you have also been openly critical of CoStar and Homes.com. Can you elaborate?

I love competition. I genuinely do. I often compliment competitors that make me better. If I can serve consumers better and respond well to competition, then ultimately, we are going to win. 

Where I draw the line is where competitors are deceptive and misleading to the extent that they disparage our brand, our people and our customers. And I think CoStar has absolutely crossed the line. They have completely misrepresented their audience position in the market. They have entirely disparaged the concept of independent buyer representation.

On every single listing on every property in the United States of America, when CoStar launched Homes.com, and for many, many months until I drew attention to the fact, they advertised that you could avoid "fake agents."

What, specifically, is your issue with the traffic numbers CoStar has reported for Homes.com?

Under CoStar's methodology for calculating audience*, I could claim an audience for the Realtor.com network that exceeds every man, woman and child in the United States of America. And I could use that claim to generate advertising dollars from my customers, but I wouldn't, because that would be lying. 

It's not the right thing to do. I have far more respect for Realtors and the community of real estate professionals that we serve.

* Eales is referring to the Homes.com Network, which CoStar says includes Homes.com, the Apartments Network and the Land Network.

Realtor.com revenue was down significantly, according to the latest News Corp earnings report. What are you doing to turn that around?

Our biggest strategic initiative is to focus our attention on the core buy and sell relationship of our primary customer. I think we have always done well on the buy-side of our proposition, but we have sold a lot of individual products without contemplating all of the needs of the customer that we're serving.

Secondly, we're improving our audience through investment in digital products, particularly around mapping, and we're introducing some important generative AI-enhanced search experiences in the year ahead. 

And then finally, in terms of content, we see that we are very much aligned with the MLSs in this industry. We've been born of the industry and for the industry, and there is a lot of advantage in creating a more strategic relationship with the MLSs that certainly surpasses the simple IDX relationship that other brokers — and certainly that Zillow and CoStar — enjoy.