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Can Zillow 'Uber-ize' the hundred-billion-dollar real estate brokerage?


Earlier this month, when Zillow announced a record high quarter, projecting to surpass a billion dollars in revenue by the end of this year, many wondered whether the company, with its 75 percent online real estate audience market share and 171 million monthly users, can "Uber-ize" real estate agents, cutting out traditional brick-and-mortar brokerage middlemen in the same way Uber bypassed taxi dispatchers.

The answer is perhaps yes, but it's not quite that straightforward.

Zillow essentially makes its money from selling leads to agents who usually work for brokers — like Coldwell Banker or Re/Max —  that provide them with marketing, insurance, sales and transaction support in exchange for a "desk fee" or a cut of their commission income.

So-called "super agents," who spend over $60,000 a year buying leads from Zillow and driving the company's growth, are already spending more with Zillow than with Re/Max in desk fees, prompting accusations that Zillow is effectively collecting a "brokerage fee" without legally being a broker.

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