Homes.com Agrees to Change Advertising Claims After Realtor.com "Smoke and Mirrors" Pushback

CoStar Group, the owner of residential portal Homes.com, has agreed to change some of its advertising claims after being challenged by rival portal Realtor.com (Move Inc.).

Realtor.com has challenged Homes.com on multiple occasions regarding CoStar's claim that Homes.com is the "number two" portal in the United States (behind Zillow)—and now Homes.com appears to have backed down after recommendations made by an independent third party, the National Advertising Division of the Better Business Bureau (BBB).

According to a release from BBB, CoStar’s advertising claims are misleading because the monthly visitor figures it shares as part of its "we're number two" statistics are a combination of web traffic numbers to several other CoStar-owned websites, not just Homes.com, which Realtor.com has been saying for months.

Furthermore, Realtor.com has gone one step further by claiming that, according to third-party traffic data, Homes.com is the fourth-most visited real estate portal nationwide.

Damien Eales, CEO at Realtor.com, said:

"We’re pleased the National Advertising Division saw through CoStar’s smoke and mirrors and put this issue to rest with the recommendation that CoStar withdraw their false advertising claims of 156 million monthly unique users for Homes.com and having double the traffic of Realtor.com.

"The contrast with CoStar is becoming increasingly clear. CoStar has misled Homes.com customers while Realtor.com has remained focused on growing a quality audience and quality leads for both buying agents and listing agents."

Despite the reluctant olive branch of changing its advertising claims, CoStar Group remains steadfast in its belief that it is still the number two portal operator in the States, with the Group's General Counsel, Gene Boxer, commenting:

"Homes.com is the No. 2 most-visited residential real estate portal, far surpassing Realtor.com, and the Homes.com Network has double the traffic of Realtor.com.

"Apples to apples, Realtor.com is losing the portal wars, and losing big.

"Consistent with (the National Advertising Division’s) decision, CoStar will continue to advertise that fact and disclose the number of unique visitors to the Homes.com Network and Homes.com.

"Realtor.com keeps trying, and keeps failing, to hide the facts. We couldn’t be happier to continue spreading the word about the success of Homes.com, and in compliance with the NAD’s recommendation, the success of the Homes.com Network.”

The heated, and increasingly ugly, rivalry between Homes.com and Realtor.com recently went up a notch with Realtor.com suing Homes.com for hiring an ex-employee and using his access to sensitive data to accelerate Homes.com's growth.