Craigslist Founder May Charge Fees For Rental Listings
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Craig Newmark, the founder of Craigslist.org who once said that his corporate mantra is to “give people a break,” is finding another way to do just that.
Mr. Newmark is considering charging a fee for rental brokers who post to the New York City version of Craigslist, which he established nine years ago as a free marketplace for dates, jobs, homes, and a variety of things that can be traded. Craigslist already charges for job postings in certain cities, but Mr. Newmark says the new fees are a first for rental listings. He said he’s pursuing them as part of a crusade against unscrupulous brokers in the city.
As the inventor of the city’s most popular listings site, he hopes the move will weed out brokers who post misleading ads.
“Some brokers who charge fees are posting in the ‘no fee’ area of our site, or are failing to disclose they are brokers,” he said. “There are lots of bait and switches going on.”
Mr. Newmark made his comments earlier this week at the Real Estate Connect conference, sponsored by real estate guru Brad Inman, at the Waldorf-Astoria. The charges will also apply to homeowners who post listings on the site.
Mr. Newmark hasn’t decided how much he will charge yet. “It cost $25 when we began charging for job postings, but it could be much less, I don’t know,” he said. “My primary objective is to improve the quality of the site.”
He hopes to have a meeting with brokers in the coming months to discuss his plans for adding the listing fees. “Brokers are asking us to do that to improve quality. The first step will be opening up a broad discussion of how to do it right.”
Mr. Newmark’s online empire began when Craigslist was launched in San Francisco. It now has editions for dozens of cities in America and abroad. The Web site has an average of 5 million visitors each month. Its revenue comes from charging employers a fee to post jobs in New York, San Francisco, and Los Angeles.
The New York Web site will be the first to also charge for rental listings, in response to “overly aggressive brokers here in the city.” Mr. Newmark said.
With a neighborly attitude and zeal for doing the right thing, the 51-year-old Mr. Newmark was a hit at this week’s conference. “I’m trying to dress in black more and be more cynical, but it’s not working,” he said, getting laughs from a packed audience during his keynote address on the first day of the conference.
Using unorthodox methods to get better acquainted with the players in the New York real estate scene, Mr. Newmark told the crowd: “I visit the occasional brokerage firm here in the city to terrorize them – it is very satisfying.”
He also spent an afternoon at an East Village coffee shop the day before attending the New York conference, getting an earful from residents who had been duped by brokers abusing his site to lure potential renters.
“As for misbehaving brokers, it is a violation of their license to post in a nofee area if their apartment has a fee attached,” said Eileen Spinola, head of residential real estate for the Real Estate Board of New York.
“But as in any occupation, you are going to find any number of people are crossing the line, and it is up to the industry to bring these people to task,” Ms. Spinola added.
And a real estate educator, Esther Muller, welcomes the move.
“It is about time that Craigslist begins charging for listings and that some in the brokerage community be forced to disclose whether an apartment comes with fees attached,” she said.