The Real Deal New York

REBNY returns fire in StreetEasy battle, cites “maelstrom of consumer confusion”

Industry lobbying group maintains that controversial “premier agent” program may be illegal
By Katherine Clarke | March 20, 2017 08:30AM

From left: John Banks and Susan Daimler

The Real Estate Board of New York penned a second letter to the Department of State regarding StreetEasy’s controversial new “premier agent” program, stressing that the initiative had resulted in “a maelstrom of consumer confusion.”

In the new letter, which was reviewed by The Real Deal, REBNY cites multiple instances where a consumer was allegedly misguided by the feature, which by default directs buyers to agents who pay to advertise on the site rather than to the exclusive listing agent.

In one such instance cited by REBNY, a broker who tried to contact the listing agent for a property in New York was allegedly directed to an agent in Ohio, who said she had bought the leads and was referring them to two or three New York agents for a slice of the commission. Other times, consumers have shown up with their own brokers to a listing, only to be “accosted” by a premier agent claiming to represent them, the trade group said.

Earlier this month, REBNY asked regulators to examine the program, claiming it violated a rule that prohibits advertising a property that’s subject to an exclusive with another firm. StreetEasy later challenged that notion in a response to the DOS, saying it was perfectly legal.

“Zillow neglects to address the consumer confusion caused by the new program,” REBNY’s attorney, Claude Szyfer, said in the new letter, dated March 17.

“Zillow claims that a listing agent ‘controls’ their advertising, and that if the listing agent has an issue, they are free to take down the listing,” he continued. “Zillow’s argument misses the point. The point is not for the brokers to shun StreetEasy, but to simply have the Premier Agent advertising program comply with well-established New York law.”

REBNY, which maintains the program may be illegal, also shot down StreetEasy’s prior claims that REBNY’s objections to the program were anti-competitive and bias towards listing agents.

“REBNY does not promote one side of the brokerage market over the other – which StreetEasy is apparently doing,” Szyfer wrote.

In an interview with TRD, REBNY President John Banks said “there is deep concern about how StreetEasy is conducting this program.”

“All we’ve asked for is an opinion,” he said. “That’s not anti-competitive, that’s good due diligence.”

Meanwhile, StreetEasy is showing some signs of being flexible with how the program is designed. In an email to New York agents last week, the firm’s general manager, Susan Daimler, said the company will try out new iterations of the agent contact box on listing pages.

Some of the city’s largest brokerages, including Corcoran Group, Citi Habitats and Town Residential, have said they will not support the program.