Commercial real estate data giant CoStar Group has agreed to buy Homesnap, representing its first major step toward collecting data on the residential real estate market.
CoStar will pay USD 250m in cash for the app and technology provider, according to the Wall Street Journal.
Homesnap collects data from over 500 data sources and has subscription service agreements with roughly 240 multiple-listing services, which provide data and subscription revenue to the company in exchange for free agent access to its premium service. The platform contains 1.3m active property listings and aggregates information on property taxes, mortgages, individual property parcels, neighbourhood schools and other property data elements, the company said.
Speaking about the transaction, CoStar’s CEO Andy Florance said: “A very large percentage of CoStar’s clients such as investors, banks, government agencies, appraisers, suppliers, and brokerage firms are active in both commercial and residential real estate, so we believe that they would welcome a more comprehensive solution for their needs across all real estate segments.”
The deal is expected to close later this year.
In May, CoStar made another large acquisition when it announced it would pay USD 190m for Ten-X, a commercial real estate auction platform, citing expectations of a “tsunami of distressed [real estate] deals” that would hit the market over the next three to five years. CoStar reportedly had USD 1.4bn of revenue last year, the WSJ noted.
While CoStar’s size allows it to offer a holistic picture of real estate data for investors, it has several competitors that offer segments of that data universe more cheaply, according to Neudata analysis. Earlier this year, competitors Trepp and CompStak announced a partnership that would allow them to offer a greater variety of data to investors. Market watchers observed that this partnership could make them more competitive with CoStar, but CompStak’s founder called the timing “coincidental”.
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