HomeAdvisor Spin-Off Aims to Service Realty Industry

Microsoft and a group of mortgage-lending institutions have announced the formation of HomeAdvisor Technologies Inc., a joint venture that aims to automate and streamline home sales. The new company will combine technology for processing real estate transactions, desktop tools for realtors, and the MSN HomeAdvisor realty portal for consumers. Microsoft will hold a majority stake in the new company, formed with partners Chase Manhattan, Freddie Mac, GMAC-Residential Funding Corp. (GMAC-RFC), Norwest Mortgage, and Bank of America.

The formation of the new company fits a now-familiar pattern: using as a starting point an MSN property targeted at a specific consumer market, Microsoft seeks partnerships with industry leaders to create an Internet “marketplace,” an online center that links end-to-end, business-to-business, and business-to-consumer technology solutions. Microsoft attracts outside capital by offering the possibility of stock in an independent or semi-independent venture. In spinning off Expedia and partnering with Ford and auto dealerships through CarPoint, Microsoft has already established marketplaces in the travel and auto industries. It has also invested in Healtheon, a company aiming to do the same in the health industry and which now provides the content at MSN Health.