Realogy, Amazon Partner on TurnKey Program for Buyers
Realogy stock surged more than 25% last Tuesday after it announced a deal with Amazon.
The largest residential real estate brokerage company in the nation is partnering with the largest online retailer in the world in a strategy designed to boost sales for both.
Realogy and Amazon will now offer TurnKey, a program that takes potential homebuyers through the Amazon portal and connects them to a Realogy agent. Once they purchase a home, they then get complimentary Amazon Home Services and products worth up to $5,000.
After the announcement, Brad Iman (Inman News) wrote that TurnKey “promises to simplify the process of buying and moving into a new home. It also adds a potentially big lead generation business for Realogy.”
“As the big private equity firms invested billions in real estate services the last few years,” Inman added, “it was only a matter of time before one of the FANG gang (Facebook, Amazon, Netflix and Google) stuck its toe in the $100 billion real estate commission pond.”
Realogy, which owns such brands as Coldwell Banker, Century 21, Sotheby’s International Realty, Corcoran, ERA and Better Homes and Gardens Real Estate, has been up against stiff competition from newcomers like Compass and Redfin, both of which rely heavily on high-tech, online platforms. Partnering with Amazon gives Realogy a platform unlike any other.
“We’re the market leaders in this industry and we like that position, but you always have to be innovating to stay ahead, you’ve got to be willing to cannibalize yourself, you’ve got to do all the things that a big successful company needs to do to stay on the forefront,” said Realogy CEO Ryan Schneider.
“In a world that is awash with low quality lead generation out there, where you can get real estate leads from millions of online websites, giving an agent and franchisees high-quality leads from a source like Amazon and Realogy together is a real differentiator that’s going to be very powerful for the group.”
How It Benefit Buyers
A potential buyer will go to the TurnKey portal on Amazon which will take them to a Realogy page. They put in information on the type of home they’d like to purchase, the location and price. They are then matched with a Realogy agent. Once the buyer closes on the home, Amazon connects them with services and experts in the area. The buyer not only gets a selection of Amazon Home Services, like painting or hanging a large TV, but they also gain access to smart home products, like a Ring doorbell, to be installed by Amazon. The value of the free products and services can range from $1,000 to $5,000 depending on the purchase price of the home.
“Customers can be overwhelmed when moving, and we’re excited to be working with Realogy to offer homebuyers a simplified way to settle into a new home,” said Pat Bigatel, director of Amazon Home Services. “The Amazon Move-In Benefit will enable homebuyers to adapt the offering to their needs — from help assembling furniture, to assisting with smart home device set up, to a deep clean, and more.”
“Amazon, Google, Apple, most of the technology-centric companies are starting to think about the home as a centerpiece for the way they think about the future of how their products work and how they interact with them, ” said Stuart Miller, executive chairman of Lennar, in an interview in May 2018. “Home automation is a point of attraction. It’s a proxy for a lot of other things.”
Markets Include Los Angeles
TurnKey will launch in 15 major metropolitan housing markets, including Seattle, San Francisco, Los Angeles, Atlanta, Dallas, Chicago and Washington, D.C. Schneider said he expects to expand into more markets. He did not, however, suggest that this is a stepping stone to putting Realogy brokerages’ listings on Amazon.
“The big tech mamas have muscled into real estate before,” added Inman. “Both Facebook and Google make a killing off agent advertising, and Microsoft was all in back in the middle 1990s with its Homeadvisor product, which fizzled and was sold off.
“Zillow, on the surface, has the most to lose,” he added, “and Wall Street signaled that on the early news, pushing down its stock almost 3.75 percent in pre-market trading. But, it quickly recovered and is now trading in positive territory. The Street and everyone else, me included, is still trying to figure out the news.”