CoStar CEO Andy Florance and REBNY president James Whelan (Getty, iStock, REBNY)
A long-awaited public portal for the Real Estate Board of New York’s residential listings is officially on its way, with a well-heeled partner bent on ending StreetEasy’s reign as the city’s dominant listings platform.
Branded as Citysnap and slated to come online in the second quarter of 2022, the portal will be built through a partnership between REBNY and Homesnap, a residential software company owned by commercial data giant CoStar Group. The Real Deal first reported REBNY’s partnership with Homesnap last December.
REBNY president James Whelan called CitySnap an “extraordinary effort” that would bring upgraded technology and more transparent and accurate listing data to consumers and agents.
All of New York City’s largest brokerages appear united behind the initiative. Executives at the Corcoran Group, Douglas Elliman, Brown Harris Stevens and Compass all issued statements expressing support for Citysnap in a press release, with Richard Ferrari, Elliman’s New York CEO, calling it “the ultimate gamechanger.”
That’s a break from the past, when infighting among the major firms has repeatedly scuttled plans to create a city-wide Multiple Listing Service.
The response from agents and other industry insiders, meanwhile, has been mixed. Though most said they will support the new portal and trust CoStar’s track record for accurate data, some agents expressed wariness over why it’s taken REBNY so long to deliver on its promise of a public-facing listings portal and uncertainty about how it will work.
Terms of the partnership, including how Citysnap will generate revenue, were not disclosed by either party. REBNY declined to comment on whether membership dues would contribute to the portal’s build-out, but in a statement, CoStar chief executive Andy Florance said his company is “committed to investing the resources needed to make Citysnap successful.” Records show that Homesnap is the registrant of Citysnap’s online domain.
“My honest take on it is that it’s a little too late to be building another listing portal at this point,” said Ariel Dagan, who leads a rental-focused team at Compass. “There’s a listing portal catering to nearly every single niche you could think of, so I just hope this is not just another one of those.”
Asked about the lengthy timeline, a REBNY spokesperson responded that “innovation and transformational change don’t happen overnight.”
“Without saying too much bad about REBNY, agents are always talking all day about what exactly are they doing with these dues and how much progress are they making,” said Jed Wilder, a rental agent who also runs a team at Compass. “We’ve been waiting for a long time for something in New York besides StreetEasy.”
Antonio del Rosario of Brown Harris Stevens called Citysnap “a smart move,” but said the bigger question is how New Yorkers respond.
“It’s really all about the consumers,” he said. “Will they welcome this new platform? Only time will tell.”
Winning over consumers would mean wresting eyeballs away from StreetEasy, New York’s de facto MLS and the most popular listings site for consumers and agents alike.
A subsidiary of Zillow Group, StreetEasy has become a flashpoint within the city’s brokerage community, attracting fierce backlash from agents and brokerage executives for its advertising programs, rental listing fees and its parent company gaining a New York broker license, among numerous other dust-ups over the years.
Though many rival portals have attempted to leverage the brokerage’s community’s hostility and distrust of StreetEasy for their own gain, none have had the funding or staying power to pose a lasting threat to StreetEasy’s position. That could change given Citysnap’s backing by CoStar, a publicly-traded company with a market cap of more than $36 billion.
John Mazur, Homesnap’s president, said it would be making “significant investments” in marketing and product to make Citysnap competitive.
CoStar has been looking to expand into residential data for years and has spent more than $1.4 billion since 2014 acquiring companies including Apartments.com and Homesnap. The figure would have been over $2 billion if CoStar’s $588 million acquisition of RentPath had gone through — the deal was terminated after the Federal Trade Commission signalled it would block CoStar’s purchase.
By taking on StreetEasy in New York, one of the most notoriously data-challenged luxury markets in the country, CoStar could deal Zillow a powerful blow. Last December, a source with knowledge of the deal said Homesnap’s interest in partnering with REBNY was to “go after Zillow.”
“It’s a better customer experience,” CoStar’s Florance told Bloomberg of Citysnap on Wednesday. “With this person I’m calling, am I initiating a nightmare of telemarketing, or am I reaching the agent who knows about this listing?”
In a statement, a Zillow spokesperson said StreetEasy “arms consumers with information that puts them in control when finding their next home.”
“We do this because we know how important it is for all consumers to have someone in their corner directly representing their interests when shopping for a home,” the spokesperson added.
The New York Residential Agent Continuum, a group representing the city’s agents, has long been critical of StreetEasy’s advertising practices and is hopeful that new competition will benefit agents and consumers alike.
“It’s important for our ecosystem to have more than one trusted data source,” said Heather McDonough Domi, NYRAC’s founding chairperson. “I hope that Citysnap will finally offer that alternative to the consumer.”
But there are some concerns over CoStar’s heft and its litigious track record.
“You have to ask yourself, is this not the fox in the henhouse?” said Donna Olshan of Olshan Realty. “They’re obviously trying to buy and get ahold of as much data as possible. Where do you think that’s going to end up?”
Compass’ Dagan said a not-for-profit trade organization like REBNY and a publicly-traded behemoth like CoStar make for strange bedfellows. “That should raise eyebrows in my opinion,” he added. “The internet is a winner-takes-all market.”
For BHS’ del Rosario, however, the choice is simple: “I trust CoStar more than Zillow and StreetEasy,” he said.
