CoStar Group, having recently lost the battle to purchase CoreLogic, hasn’t given up yet. The commercial proptech giant has announced it has entered an agreement to acquire Homes.com, a division of Dominion Enterprises, for $156 million in cash.
Andrew C. Florance, Founder and Chief Executive Officer of CoStar Group, said:
“We are excited to welcome the Homes.com team to the CoStar family. We believe that the acquisition of Homes.com is highly complementary alongside Homesnap, the industry-leading workflow and marketing platform for residential real estate agents that we acquired in December last year. The combination of Homes.com’s online portal and consumer traffic with Homesnap’s powerful mobile tools and highly effective agent marketing solutions has the potential to create a differentiated service that uniquely focuses on selling a house faster and at a better price, rather than just trying to take agent fees.”
Homes.com is already a popular residential marketplace with over 500,000 residential real estate agents and brokers utilizing its services. Homes.com has reported that around 5 million users visit the website a month and it has almost 1.8 million residential property listings on its platform currently.
Homes.com offers an easy and effective way to advertise and market listings through feeds that take up over 90% of all MLS subscribers in the country.
Dave Mele, President of Homes.com, said:
“The Homes.com team and I are looking forward to working with our new colleagues at CoStar. Together we will be dedicated to growing the Homes.com brand and building innovative solutions that expand the marketing options available to consumers and their agents.”
Florance explained in detail what is lacking in offerings such as residential real estate marketplaces, and is confident that between CoStar and Homes.com, the winners will be the average American home hunter. Florance explained:
“Unfortunately, current residential listing sites do not serve the interests of homeowners or their agents as they focus on selling advertisements on top of agent listings and increasingly offer competing brokerage services. These sites generate a portion of their revenue from directing potential homebuyers away from the listing agents to unrelated buyer agents that are advertising on top of listing agent listings. This is a practice we plan to no longer continue. Our plan in bringing Homesnap and Homes.com together is to help agents market their listings in support of the ‘your listing, your lead’ philosophy – which stands in contrast to most players in the industry.”
The agreement is an expected one, as CoStar, being primarily focused on commercial real estate, announced it was looking to break into the residential market. More information on the agreement will be provided by the company in the coming months, but the acquisition is set to be complete by the end of this year.