The Nextdoor social networking site is getting into the real estate business, as it catches the attention of venture capitalists. It’s rolling out a platform for real estate listings that makes it easy for agents to advertise homes for sale, within a particular zip code. The website is moving quickly to expand its reach and just raised another $75 million to move closer to its goals.
Nextdoor allows neighbors to communicate with each other about almost anything. They can exchange comments about local restaurants, events, lost pets, security concerns, personal belongings they’d like to sell or give away, or anything else that’s on their minds. It helps them communicate with each other about what’s going on in their neighborhoods.
Nextdoor Real Estate Listings
You might’ve even seen the occasional real estate ad floating by in your Nextdoor newsfeed, but in August, Nextdoor introduced a dedicated real estate section. It was created for real estate agents to upload listings so people who live in the neighborhood can see what’s for sale.
These are full-featured MLS listings with descriptions, photos, and links to listing websites. The listings are under the Real Estate tab on the left side of the page. Nextdoor says that new listings will also be announced in the newsfeed and by email (1).
Agents can also advertise their own services by paying a fee for a particular zip code and becoming a so-called “neighborhood sponsor.” Nextdoor will only allow a limited number of neighborhood sponsors per zip code, so it’s apparently first come first serve with one to five agents allowed for each zip code. Nextdoor says the number of sponsors depends on the number of Nextdoor users in that zip code, how much they use the website, and how much demand there is for real estate agent services.
Nextdoor has been expanding the real estate service to cover more cities. In August, it launched the real estate feature in ten major metros including: Atlanta, Austin, San Francisco Bay Area, Dallas-Fort Worth, Houston, Los Angeles, Phoenix, Portland, Sacramento, and San Diego. It then added: Seattle, Tucson, Santa Barbara, Fresno, and Waco, Texas to the real estate service mix. And more recently, it launched in Minneapolis, Washington, D.C., Tampa, and Sarasota. They are choosing markets based on the strength of the housing market.
Racial Profiling Issues
Nextdoor has apparently addressed recent problems with racial profiling by users. That issue grabbed headlines earlier this year when users in Oakland were warning people about suspicious behavior in their neighborhoods, and identifying the people they thought were suspicious only.
The website has done extensive work to change the way it allows the reporting of suspicious behavior and criminal activity by controlling how the postings are worded. Although it received an award from the city of Oakland for its work to prevent racial profiling, some people say the company hasn’t done enough. Among their concerns, as reported by Wired, is the need to upgrade the mobile app to control “that” content along with the comment feature where people respond to posts (2).
$75 Million from Venture Capitalists
That controversy hasn’t bothered venture capitalists however. The latest $75 million round brings total funding up to about $275 million, and will likely be used to expand Nextdoor into more communities.
The company’s CEO, Nirav Tolia, told TechCrunch, the website is now serving about 160,000 communities in the U.S., the U.K., and the Netherlands. He said in August, he’d like to get Nextdoor into 85% of U.S. communities by the end of this year along with expansion into Germany, India, Japan, and Brazil. The company is reportedly valued at about $1.5 billion (3).
Real Estate Revenue
As for the real estate section, Tolia told HousingWire, “some of the most popular neighborhood conversations on Nextdoor have been about homes for sale and the local real estate market.” He said, “The launch of our new real estate category makes it easy for neighbors to find listing for nearby homes and identify and connect with the most recommended real estate professionals in their local area.
And it isn’t just for people searching for a home to buy. Tolia said, “People spend the majority of their networth on their homes, and they want to know how those home values are doing over time.”
Tolia expects the Nextdoor platform to become quite popular. In the San Francisco Bay area, he expects at least half of the people who live there will be using Nextdoor by the end of this year. It’s not clear how many users there are, but Tolia said 60% of users are women who make $100,000 a year or more. So that’s an interesting demographic for anyone in the real estate business looking for clients.
(1) Nextdoor Real Estate
(2) Racial Profiling: Wired