The real estate industry has long occupied a prominent place on the digital pages of websites and mobile apps. Today there is a lot of speculations that online real estate tools might one day replace agents and brokers completely. This may sound a bit disturbing if you are a real estate agent who hasn't already gone "digital."
Interest in real estate apps development has increased, which is why we think it's a good idea to spend some time talking about them on our blog. I hope it will shed some light on current trends in the mobile US real estate market.
Online brings a «wind of change» to the US real estate business
Though agents remain central to the researching real estate offline in the US, their role is rapidly changing. Property information that was once only accessible through real estate agents or brokers is now available through search engines and mobile applications. The National Association of Realtors (NAR) which has long been a gatekeeper of housing information, is seeing a real challenge from web and mobile real estate search tools. According to a joint study by the NAR and Google, 90% of homebuyers did an online search when looking for real estate.
At the same time, mobile is complementing this broad shift in the balance of power among homebuyers, sellers and their intermediaries. According to the same study, mobile applications are used by 68% of new home shoppers at the onset and throughout their research.
Who brought about the change?
Zillow and Trulia did. They are the ones who have transformed the housing market and made the home buying process more transparent. Since they are not in the business of selling homes (they sell advertising to real estate agents), these web portals can obviously provide more insight and transparency to the housing market compared to trade associations and a housing-industry establishments like NAR. Check out what Jonathan J. Miller says in the Bloomberg Opinion section about the changes taking among real estate's older, more dysfunctional players.
Here's what Stefan Swanepoel, consultant and author on real estate trends had to say about the impact of Zillow and Trulia on the market (you can find the whole article here): «Portals like Zillow and Trulia have created a whole new additional category of real estate lifestyle surfing for consumers who are interested in home prices and community information, even though they may not be in the market to buy or sell a home in the immediate future».
Zillow and Trulia have now joined forces, and this combined entity is expected to become the biggest player in online real estate advertising. The merger will also have beneficial impact on the both companies. In an interview with TechCrunch, Zillow CEO Spencer Rascoff says that they should achieve $100 million in cost avoidances by 2016 through a combination of initiatives that should focus on combined ad budget spend and reducing the number of new hires across both companies.
The revenue for both online real estate kings comes from agents, who are charged for posting their names alongside detailed listings of homes for sale. Still, the companies only make 4% of the $12 billion they spend on marketing through different channels. Spencer Rascoff hopes to generate more revenue with mobile applications. «Mobile is becoming the medium of choice for home shopping,» he said recently to CNNMoney.
According to Bloomberg, the deal between these two major online real estate companies is the largest acquisition for Zillow thus far. But it certainly isn't the first. Here is a short list of some of the acquisitions Zillow has made over the years:
- New York based leading real estate website StreetEasy.
- Agentfolio, a collaboration tool to help real estate professionals and home buyers stay organized and communicate more effectively.
- Fast-growing map-based apartment and home rental search engine HotPads.
- Retsly, a Vancouver, B.C.-based startup that helps developers access real-estate data from multiple listing services (MLS). The service takes the data from these sites and normalizes it so real estate app developers can more easily use the data in their own applications. The platform according to Spencer Rascoff «will spur tremendous innovation in the real estate space».
In full disclosure, our company worked with Zillow on some of the apps mentioned above, like StreetEasy and Agentfolio.
What you need to know if you want to develop an app like Zillow or Trulia
We're not sure if there is the best commercial real estate application: both real estate companies have a number of apps which serve different business needs. You can consult their websites (Zillow mobile /Trulia mobile) for more information about what they have to offer.
If you decide to develop an app similar to Zillow or Trulia, we thought it might be worthwhile to highlight a few of their most prominent features. This should save you a little bit of time on researching your future competition.
We chose to take a look at these companies' most popular apps: Zillow Real Estate and Trulia Real Estate. They provide home search and detailed listings of properties for sale and for rent. Actually, there isn't much difference in functionality between the apps. Let’s spell out the ingredients and see why they are important, so that you don’t miss key points.
Databases are crucial
This is the crucial component in real estate application development, as data has to come from somewhere. Zillow and Trulia currently work with existing MLS systems and the National Association of Realtors (NAR) to get access to their data. Listings may also come from 3rd party vendors, real estate companies, real estate agents and FSBO (For Sale By Owner) properties.
The real estate industry in the US is still run by the MLS system, and even such big portals like Zillow depend on Multiple Listing Services to find information about homes. I can’t help but mention that with the acquisition of Trulia, the combined company will own 71% of online real estate traffic. This may eventually lead to Zillow becoming the owner of a proprietary network that will pull brokers away from NAR and unseat MLS entirely. «He who owns the information, owns the world», — you've heard that before, right?
You can read more about the strategic Zillow-Trulia merger, and the joint entity's far reaching plans to become the almost sole owner of the real estate data in the US, in an article by Cody Boyte published on Axial.net. I emailed Cody with a couple of questions regarding access to real estate data in the United States, and here is what he said: «If you wanted to create a full system like Trulia or Zillow, you’ll eventually have to deal with the NAR or the local multiple listing services in the US. But, for the short run, to prove your product works, you could start with using the APIs from Trulia and Zillow».
By the way, improper use of Zillow’s proprietary data can hurt. To find just how much, check out a story of an app called Flipt. Hopefully, you'll be able to avoid similar mistakes when you build your real estate web portal or mobile app.
Read also: Dating mobile apps development
Advanced search functionality is more of a requirement than a recommendation
A filtered search function is extremely important for real estate apps. The better structured the data is, the better your app's user experience. Try to organize real estate information in such a way as to make the list of properties satisfy the most popular criteria for home buyers. We can separate «must have» search criteria like location, property type, price range and other options, like square foot range, on-site parking, in-unit laundry, year built, and whatever you think is important to include.
It is advisable to integrate analytics into the app, or gather data from the server to know what your users are primarily interested in when looking for property so that we can make this criteria catch the eye. What we recommend is to start with an MVP and continually enhance the product. With so many geographical areas and user segments, it's impotant to find the best fit for your product.
Let's go back to Zillow and Trulia's search functionality. Even though they both have separate apps for rentals, they put «Homes for Rent» alongside with «Homes for Sale» in their real estate apps’ search menu. By having two apps perform one and the same function, the companies aim to acquire more users. In addition, every single Zillow and Trulia app promotes other apps the companies own (e.g. app for agents, mortgage calculators), thus increasing customer loyalty to the brand.
Listings had better portray data graphically
What's the best way to get users to engage with data for real estate listing? It's simple: visually. Portraying data graphically reveals patterns in the data that are difficult to detect otherwise. Graphs and pictures win always beat long descriptions. Your app can have both, but don’t overload your app with too much info.
Zillow and Trulia listings differ from one another. Both, however, they have graphical components like a monthly mortgage breakdown, to name just one. There are a huge number of different graphical interpretations for displaying information on both iOS and Android platforms. You can find an SDK on developer resources for any type of charts / graphs.
Apart from maps and pictures of properties, including those in the neighboring area, the apps can redirect you to Google street view and Google directions with one click. This feature is both simple to implement and valuable for the end user because of its transparency.
One of the unique features Zillow has is an estimated market value tool called Zestimate, which is a starting point which can be used to determine a home’s market value or monthly rental price. This estimate is based on public data like neighborhood market guides and forecast calculations.
Read also: Event planning mobile app development
What to put on the map and how to make it look nice
Neighborhood information plays a big role in a real estate app, especially now, as customers are paying more attention to the community they plan to live in. In Zillow's app you can access it by clicking on the map. It uses markers attached to the places to display the neighborhood information filtered according to the criteria you have specified. If there is too much information to show, you can cluster your markers; in other words, you can put a large number of markers on a map without making the map hard to read.
Trulia, on the other hand, figured, that users are primarily interested in a few key indicators like crime level, med sale price, and amenities in the neighborhood. That’s why they put this info at the top of the map right in front of your eyes. More neighborhood information (affordability, natural disasters, traffic, schools, commute, boundaries, etc.) can be accessed by clicking on the map as well.
Together with placing a marker at each location for some criteria (e.g. schools), Trulia has heatmaps, that use colors to represent the distribution of data. You can consult Google Maps documentation for heatmap utility implementation on Android and displaying overlays on a map in the iOS developer library.
Maps in the two apps we’ve been talking about have «draw» functions. This is a pretty cool feature which makes maps super convenient to use. You can circle an area with your finger and the map will show you everything of interest within this zone.
Implement «save search» to retain users
Saving searches or «like» properties is not only used for keeping preferred homes in one place, but for making it possible for the realtor to see what the client prefers and suggest similar options. The app should also send push notifications when a new house that matches user search criteria appears in the indicated area.
These are the components you need to pay attention to when building your own real estate app. What I can add is that the new Zillow will still have plenty of competition from other sites and mobile apps such as Realtor.com, Homes.com, as well as from Coldwell Banker, Re/Max, Century 21 and other real estate brokers. You should check them out too if you decide to try yourself in real estate app development.