At least that is what Matt Fuller, GRI, e-Pro and Britton Jackson, CRS, e-Pro of Zephyr Real Estate have determined from research they did in San Francisco, California with Data from the Multiple Listing Service of the San Francisco Association of REALTORS.
CLAW to delay syndication feeds by 48 hours. This has been discussed by a number of MLSs this last year.
Even as we continue to hear that the conversation around syndication and data distribution is no longer needed, the fact is, nothing could be further from the truth.
In fact, many who are charged with making critical decisions relating to the future of their businesses, and the future of MLSs, struggle to understand this complex, yet seemingly simple subject.
A missing element that will help understanding, is an accepted nomenclature presented in a wiki or a glossary of terms that everyone agrees upon. It is the only sensible place to start conversations where the expectation is a rational and logical outcome. We find ourselves seven years into the syndication conversation, and we have yet to formally agree upon defined terms. In the absence of such an essential building block, I respectfully submit the following:
- Syndicator – These entities collect data, under contract, from different data sources, (MLSs, brokers, franchises) and then distribute that data under contract to companies that wish to display and build a business around that data. Point2 and Listhub are the biggest Syndicators in the real estate industry. Point2 is owned by Yardi Systems and Listhub is owned by MOVE (Realtor.com). There are smaller entities and magazines that syndicate. Too many sources is part of what is wrong with Syndication as we are experiencing it today.
- Portal/Aggregator/Publisher/Third Party Sites – Those entities that receive the data, under contract, from the Syndicators, for display on their site, mobile device, etc. Zillow and Trulia are the leading portals. Realtor.com is also a leading publisher, but unlike the others, Realtor.com has direct feeds from nearly all of the MLSs in the U.S., and does not depend upon Syndicators for its MLS data.
- Opt In – Informed Consent. Publishers start with No Listings. Your listings WILL NOT be distributed (syndicated) unless you proactively so direct…you “Opt In.”
- Opt Out – Uninformed Consent. Publishers start with All of the Listings. Your listings WILL be distributed (syndicated) unless you proactively direct them not to be syndicated. You “Opt Out.”
- Authoritative Source – If a Publisher has data on the same property, from multiple sources, which one will the Publisher publish, and which will the Publisher ignore. This is also referred to as a Trumping Order. The best data available comes from the MLS. On a true consumer site, the MLS data would always trump all other sources. MLS data would then be said to be the Authoritative Source.
- De-Duplication – The process, by the Publisher, of eliminating duplicate properties when a Publisher receives similar data from multiple sources. When duplicate property data is received, the conversation regarding Authoritative Source must be decided by the Publisher.
- Derivative Works – Any work derived from the MLS Data such as Automated Valuation Models (AVM), consumer behavioral data, a multitude of possibilities.
Point2 has begun the process of taking both of its new MLS Data Distribution Contracts to the Industry. This is a project that Industry Principal Saul Klein refers to as Contract Alignment.
The two contracts to align are:
- Content Provider Data Distribution Agreement
- Recipient Data Distribution Agreement
It is Point2’s belief that widespread adoption of these contracts has the potential to be a game changer in the world of Data Distribution (also known as Syndication), providing a better result for all stakeholders over time.
After two years of study, analysis, counsel and conversation, the Contract Alignment project is consistent with the Realty Alliance Fair Display Guidelines, and numerous other best practices resource studies and documents.
Contract Alignment will facilitate an industry friendly approach to data distribution, allowing and promoting conscious control to the providers of the data — the MLSs and listing brokers.
The following is a list of the requirements imposed on third party publishers receiving a feed of listing data under Recipient Data Distribution Agreements with Point2. Our objective is to give brokers and MLSs the ability to eliminate many of the objectionable practices with display of data that have arisen in recent years, and of which brokers, agents and MLSs have been very vocal.
Point2 Data Distribution Restrictions on Recipients (Publishers)
- The Recipient agrees to display Licensed Data only in the context of a Consumer Display.
- Recipient shall not sublicense the Licensed Data or use or display the Licensed Data in any derivative works.
- The Recipient agrees not to retain or display any of the Licensed Data after termination of this Agreement; and not to retain or display Participant Content after a Participant has opted out of display on Recipient’s website.
- The Recipient agrees that it shall not feature any other persons or companies associated with a specific listing broker’s listing in an as prominent or more prominent manner as the listing broker in any advertisement or promotion.
- Recipient will not capture prospects or leads from the display of specific real estate listings derived from Licensed Data and sell them back to Participants or Subscribers or divert any such captured prospects and leads to third parties.
- The Recipient agrees that it must retain custody of the Licensed Data; the Recipient may not operate sites on behalf of third parties, even if the data remains in Recipient’s custody, is “framed” on a third party’s site, and is labeled as “powered by” the Recipient.
- The Recipient may not retransmit, redistribute, or re-syndicate any Licensed Data.
- The Recipient acknowledges that it receives Licensed Data “as-is” and that Content Provider is not responsible for data quality or accuracy and makes no warranties to Recipient regarding the Licensed Data, including warranties of non-infringement.
- The Recipient shall provide a link on each listing display that directs consumers to the URL provided with each listing where consumers can access extended property information.
- The Recipient agrees to display all the Licensed Data supplied to it under this Agreement, unless the Recipient has a defined “niche” (such as ranches, lake properties, etc.) and then Recipient shall display all Licensed Data relevant to such specified “niche.”
- The Recipient agrees that it shall not modify the Licensed Data in any material way including, but not limited to, removing Licensed Marks, removing the Participant’s contact information or hyperlink to the Participant’s website, removing security measures, or removing any watermark from photographic images in the Licensed Data.
- Recipient shall not use the Personal Information to market or contact any Participant or Subscriber, nor will Recipient sell or supply this information to any third party for any reason.
- Distribution of the Licensed Data by Recipient to third-party websites or other mediums is strictly prohibited. Licensed Data must remain resident in the Recipient’s database and under the Recipient’s control.
- The Recipient agrees to show the listing agent’s or broker’s contact information in a prominent manner, which requirement will include at a minimum displaying information in the following manner: (i) name, a “non-scrapable” email link, phone number and link to their personal website, when provided; and (ii) the MLS number and the address of each listing (except where the Data Interface indicates that the seller of the property does not wish the address to be displayed).
- The Recipient agrees to promptly update their site upon any update of Licensed Data from Content Provider and Point2.
- Recipient must provide reporting metrics for display to the applicable Content Provider through Point2.
- The Recipient agrees to use reasonable care to protect the Licensed Data from screen-scraping and other forms of misappropriation and misuse.
- The Recipient shall display a valid copyright notice on each display screen, web page, and printout displaying any part of the Licensed Data, as may be required by the Content Provider.
- Recipient will not scrape any websites supplied or powered by Point2.
- The Recipient agrees that any fees that it charges Participants whose Participant Content it receives under this Agreement shall be marketing fees or advertising fees charged on a per-Participant, per-Subscriber, per-listing, or per-consumer-contact basis; and not brokerage commissions or referral fees requiring a brokerage license paid only in the event that a transaction closes. The only fees payable to Point2 from Participants or Subscribers will be from separate agreements signed with such Participants or Subscribers.
- Any exceptions or additions to this Section as may be approved by a Content Provider.
Realty Alliance Fair Display Guidelines for MLS Public Facing Web Sites –
These guidelines are not offered as being either for or against the concept of MLSs operating public facing websites; however, if an MLS does decide to operate a public facing website they should adhere to these concepts to be labeled as conforming to the “Fair Display” guidelines.
1. Brokers may opt-out of displaying their listings on the MLS operated public facing website.
2. Unbiased display of all listings. Search results will return listings sorted/ranked based upon the consumer’s search parameters. The search results list will not give preference to any type of featured listing, or paid placement.
3. Consistent display of listing data. Each MLS will determine the amount of listing data and photos to display on a public facing website. There will not be charges for displaying any data related to the listing or the agent, such as fees for additional photographs or the broker or agents’ contact information.
4. No ads for other brokerages or agents displayed on or with a brokerage’s listing. Only the actual listing broker and agent may be displayed on the property details page. No ads from companies that may compete with a broker’s affiliated business such as mortgage, title, or escrow companies will be displayed on an individual property listing page.
5. Leads Distributed at No Charge to the Listing Brokerage Firm. All leads will go directly to the listing brokerage firm or the agent, as directed by the firm. No leads will be diverted elsewhere. No fees will be charged for leads. Every listing will have the brokerage name and logo prominently displayed, and contact information as provided by the broker including a link directly back to the brokerage website (or other site as dictated by brokerage).
6. Make reports available to the broker. Brokerages will receive or be able to access complete reports on any traceable activities related to their listings.
7. Brokerage maintains control of all of their data. No syndication of the broker’s listing data without the broker’s consent.
8. MLSs and Brokerage Firms will work together locally to make decisions about allowing ads and other revenue generation methods on the MLS public facing website. If there are ads or other revenue generators the MLS and Brokers will work together to determine the types of ads allowable; and the types of revenue generators allowable; and an appropriate revenue share between the MLS and the listing brokers of the revenue generated.
I wrote this piece in 2002, but the concepts around marketing and lead generation are still relevant.
Your Listings on the Internet…For better or worse, they are there…now what?
Public display of other broker’s listings via the Internet has created the potential for major change in the real estate industry and that is exactly why we must move forward with our eyes open, going back to the basics and understanding the fundamentals before we move forward. It is time to re-evaluate where we have been and then where we want to proceed…or someone else will do it for us.
Let’s start by looking prior to the days of the www (the graphical part of the Internet), which has been around since 1992 or so with the development and then commercialization of “browsers” (The Internet has been around in some form since 1969).
Things were pretty simple in pre 1992 real estate. The two major ways to make money in real estate sales were:
If I took a listing, I could use that listing to help me generate more listings. “For Sale” signs and “just listed” mailings increased my “presence” and the chance that other owners would recognize me as a real estate sales leader in the neighborhood (and hopefully, help me get more listings). There was a recognized promotional value in the listing. Other brokers were not allowed to put their signs on my listings…they were not entitled to the promotional value I gained when I got that owner to sign my Exclusive Authorization and Right to Sell (listing agreement).
Listings and their promotional value helped me find buyer leads for my listing, other listings I might have…and…because I was a member of the MLS (“unilateral offer of compensation”), listings of other broker members of the MLS.
If I had a listing I could run ads and when calls came in (leads)I could begin to work with the caller by inviting them into my office to meet and discuss perhaps other properties in which they might have an Interest. This might include other broker’s listings as well as my own. I had no obligation to give the name and phone number of the listing broker when I provided listing information to a prospective buyer who came into my office. When I took a prospective buyer out to look at property, I had no obligation to give the prospect the name or phone number of the listing broker. I simply “showed” the property” and provided information, answered questions, etc. If the buyer said: This is great, now please give me the name of the listing broker so I can write an offer,” I was under no obligation to do so.
Once again, and this is an important concept, the listing itself had a promotional value that we all recognized and of which, only the listing broker, could take advantage. Listing brokers had no obligation to let competitors benefit from the promotional value of the listings they worked to obtain (Listings are the property of the broker. We all learn this in pre license classes and the Internet and web do not, because of their existence, change this foundational aspect of the business).
As a matter of fact, state real estate laws prohibited the advertising of another broker’s listing without the listing broker’s permission (still the case today).
Now roll forward to 2002:
As many RealTalkers might remember, Internet Crusade has been putting the IDX/VOW subject in front of readers for at least the last year…and most REALTORS in the field are not yet aware of ideas and concepts that have the potential to change the way many do business.
Today, there are at least 3 identifiable ways to make money in real estate sales:
Lead Generating and Referring
While referring existed prior to 1992, it was not a major part of most real estate businesses (except for maybe relocation, which was usually done within the confines of particular companies).
Listing information is content and it still has that promotional value. So who is entitled to the benefit of the promotional value created by listings? Many are saying all brokers (and even their agents, without their broker’s permission) have the right to display on their website as information, all the MLS listings without obtaining permission of the listing broker. While IDX requires permission, VOWs do not. This is a major distinction and critical to any discussion on VOWs.
Have you been to http://RealEstate.Yahoo.com? The site indicates: “Search our COMPLETE data base of MLS Listings”
Where did Yahoo get the COMPLETE MLS data base?
Have you gone to e-Bay lately and clicked on “Real Estate?”
Did you know that e-Bay is a licensed broker in most states? That means you could be in direct competition with e-Bay.
“List your home on e-Bay and on the MLS” says e-Bay (FSBOs and your listings in one spot). You can list for a flat rate listing fee on e-Bay.
By virtue of VOW concepts, e-Bay (as an MLS participant) can access all the listings of MLSs to which they belong and put the listings on e-Bay as content (along with FSBOs who post their own listings on e-Bay, which makes e-Bay a more complete data base and perhaps more appealing to potential buyers looking for homes).
This content on e-Bay…most of it your content (your listings)…draw buyers…who may then be sold back to you as leads…and e-Bay gets the content FREE (IDX/VOW). And since e-Bay is a licensed broker, it may be difficult to restrict their use of the data…in fact, that might be dangerous and border on anti trust. For you to survive, you must create a competitive model yourself.
And then there is REALTOR.com…REALTOR.com pays your MLSs 8 million dollars a year for the listings…e-Bay and Yahoo pay nothing through IDX/VOW. REALTOR.com has many restrictions based on a thousand page operating agreement, Yahoo and e-Bay have none. As REALTORS, It is time to seriously consider what REALTOR.com can become. Give it you attention in addition to your criticism.
And what about leads from the Internet? If you don’t have the means to generate them yourself, there are companies that will help you with Internet leads for a fee. Weigh carefully their business proposition to you because they just might make economic sense.
There is a cost to lead generation and you need to examine your cost and compare it to some of the new referral programs available online. I recommend that those who are serious about being competitive in this business over the next 5 years do some web surfing to see what they might be up against and how they can best utilize the Internet in the development of their own business model.
The business has always been about leads. What is one of the biggest time consumers in a REALTORS day…prospecting, and working on the development of leads…from cold calls to door hangers to direct mail, to signs on listings to classified ads…all designed to make the phone ring, leads… Brad Inman says nothing new when he says the business is all about leads…what is new is where many of those leads will come from, how they will be matched and distributed, and if there is a more cost effective way to develop leads than the old ways many agents and brokers are so used to.
What are you paying for your leads right now in your time and marketing…how can you generate leads from the Internet? What will you (do you) pay for those leads? Is it less than you are paying now for leads (when you consider all your marketing, advertising, referral fees, prospecting, cold calling door knocking, etc)? It is your job to find out what is right for you and how you fit into a changing real estate industry. Referral models are proving to be a third major area of revenue in the real estate sales business…Listings, Sales, Referrals.
Just like many in the industry did not and still do not know about IDX and VOW…many do not know about some of the new business models that have the potential to change the business of real estate. And it is everyone’s responsibility to know about the business they are in and know that there is no substitute for your own due diligence.
From someone who has observed closely the evolution of listings and consumers on the Internet since 1993 , from the inside and the outside, I want to stress to you that IDX and VOW are important pieces of a much bigger puzzle…who will put the puzzle together first is the question we are all looking to answer…and by participating with us in our online discussions, you will have a better chance of learning what you need to know about industry changes first, and how these changes might affect your livelihood and your future in real estate.
Syndication is NOT IDX nor is it VOW – By Saul Klein
This is a critical distinction. Syndication is NOT IDX. “Repetition is the mother of learning,” so let’s repeat that. Syndication is NOT IDX. They are different types of intended data distribution, each with its own set of “rules.”
People often get confused on this point because, at face value, the concepts appear to be very similar, and to the untrained, they seem identical. Nothing could be further from the truth.
Syndication is the term that has come to describe the distribution of listing information for the purpose of advertising, usually to multiple places on the Internet, with a “single point of entry” (the MLS). Today, syndication models are moving toward “Opt In,” which means your listings will not be distributed to any site, unless you select where you want the listing to appear, and allow the distribution of your listing (informed consent).
IDX is a way of displaying your competitor’s MLS listings on your website. It is a form of syndication (remember, syndication is merely distribution). Because it entails the advertising of a competitor’s listings on your website, permission is required of the listing broker, and IDX rules facilitate these permissions in a “blanket” way.
So, syndication is not IDX. Syndication focuses specifically on where you want to advertise your listings, whereas IDX focuses on an authorized participant’s ability to display (advertise) other broker’s listings (competitors) on their website.
Syndication is NOT IDX
IDX (Internet Data Exchange)
|Allows you to advertise your listing on online marketplace websites (these listing portals are not licensed brokerages). Typically there is no charge.||Allows agents/brokers to display the listings of others on their own website (these websites are owned by competing brokerages). Typically there is a charge for the IDX solution.|
|Bound by the terms and conditions of the Syndication Agreement.||Bound by the IDX Rules of the MLS.|
|You grant permission for a Syndication Partner to display your listings.||Other agents/brokers grant permission for you to display their listings.|
|The listing agent is the contact person and receives the leads.||The leads go to the site owner, regardless of who the listing agent is.|
When you post your listings to your local MLS, you often have the option of using IDX (Internet Data Exchange). This means you are giving permission to other members of your MLS to be able to display your listings on their sites. Every MLS has different rules about how the listing must be displayed (built around a set of NAR “Model Rules” in which some aspects are mandatory, and others left to local MLS discretion) and how the leads are handled, but you are more or less opting to give your direct competition the ability to advertise your listings and possibly gain leads by using them. This works both ways of course, but you generally don’t get the option to choose who can and cannot display your listings. Ask yourself: do you want your nearest competitor to advertise your listings? Do you want to advertise theirs?
In every jurisdiction that I know, one cannot advertise another broker’s listing without the consent of the listing broker. IDX facilitates this process by allowing brokers to grant blanket permission rather than have to obtain consent on a listing by listing basis. IDX is broker to broker advertising and is reciprocal (as a matter of fact, it was first known as Broker Reciprocity). Syndication –the term as used in the industry today– is distribution to non-licensed publishing entities such as property search sites.
IDX is an agreement the broker or agent makes with the MLS, allowing you to leverage the listings of others as a means of attracting more consumer eyeballs to your site. Keep in mind that this also allows others to benefit from your listings. If you opt in to use IDX, you are sharing all of your listings (except those the seller does not want displayed). If you don’t opt in, you are sharing none and won’t be able to display other broker listings. IDX is all or nothing.
The main difference is that with syndication, you are sending out, or distributing, your own listings to as many publishing channels as you choose. You aren’t displaying the listings of others on your website like you do with IDX. You are just getting your listings more traction by displaying them on many different sites across the web, at no charge and no extra effort on your part assuming the listing feed is generated by your Multiple Listing Service (MLS) under an arrangement with an approved syndicator.
The other main differentiator is that (in most cases) syndication services will let you pick and choose which of your listings are syndicated to which sites, at multiple levels within the listing ownership and management chain. The MLS is typically at the top of the chain, then the brokers, who can opt to not allow agents to syndicate to a particular site. The agents can then exercise further control, based on their own and their seller’s decisions. Ideally, this is an option right down to the listing level. You can decide to not show a specific listing on a specific site, while showing the rest of your listings on the same site. It is not “all or nothing” as it is with IDX.
With syndication YOU are given the control. Controlled Syndication is all about choice and control. As opposed to blanket syndication, controlled syndication (also known as strategic syndication) refers to the use of a syndication engine in which the user controls where and under what conditions the listing is distributed to advertising channels.
Now, how are Virtual Office Websites (VOWs) different?
IDX is a way of advertising and marketing listings. VOWs, on the other hand, are a way of doing business over the Internet by providing useful information to a customer or client. It’s a question of Information vs. Advertising.
A VOW allows the display of all listings (except if seller refuses). No broker permission is required; i.e.,the opt-in/opt-out procedures with IDX do not apply to VOWs. Unlike an IDX that displays only a subset of data, a VOW will display all non-confidential listing data, including SOLD data (except in non-disclosure states like Texas, Utah, Alaska, Louisiana, New Mexico).
A VOW requires the visitor to register and provide an email address. A Participant may provide brokerage services via a VOW, but only to clients and consumers (“Registrants”) with whom the Participant has first established a lawful consumer-broker relationship in compliance with state law disclosures. Visitors to an IDX site do not have to register to gain access to the listings.
Prior to the Settlement Agreement between the Department of Justice (DOJ) and the National Association of REALTORS (NAR) in 2007, Saul Klein voiced his opinion of the DOJ’s position on VOWs.
In this paper, Saul makes note of the “promotional value” of listings, a prime reason why listing brokers might object to competing brokers and listing search aggregators sometimes capitalizing on the listing broker’s hard work in obtaining and servicing those listings.
Here is what he said in early 2006:
NAR’s VOW Policy
by Saul Klein, Internet Crusade
It seems the U.S. Department of Justice (DOJ) has found at least two aspects of the proposed (yes proposed, not implemented) National Association of REALTORS®(NAR) VOW Policy objectionable and DOJ has gone so far as to threaten legal action. DOJ has also recently voiced objections involving the states of Texas, Oklahoma and Kentucky.
Is this a DOJ conspiracy against the real estate industry or just poorly informed government employees with nothing better to do…or both?
The current proposed (and well thought out) NAR VOW Policy has been under
review by DOJ for the past 18 months and DOJ has found the following
1. Selective Opt out provision (there are 2 types of Opt Out provisions in
the NAR proposal, Blanket and Selective Opt Out)
2. Restrictions or limitations on use of VOWs to generate referral business
by companies not involved in the actual listing and selling of real estate.
Public display of other broker’s listings via the Internet has created the
potential for major change in the real estate industry and that is exactly
why we must move forward with our eyes open, going back to the basics and
understanding the fundamentals before we move forward. It is time to
re-evaluate where we have been and then where we want to proceed…or
someone else will do it for us.
Let’s start by looking prior to the days of the Web (the graphical part of
the Internet), which has been around since 1992 or so, popularized by the
development and then commercialization of “browsers” (The Internet has been
around in some form since 1969).
Things were pretty simple in pre-1992 real estate. The two major ways to
make money in real estate sales were listing and selling.
If I took a listing, I could use that listing to help me generate both
buyers and more listings. “For Sale” signs and “just listed” mailings
increased my “presence” and the chance that other home owners would
recognize me as a real estate sales leader in the neighborhood (and that
would, hopefully, help me get more listings). There was a recognized
promotional value in the listing. Other brokers were not allowed to put
their “For Sale” signs on my listings…they were not entitled to the
promotional value I gained when I got that owner to sign my Exclusive
Authorization and Right to Sell (listing agreement). It cost money to
generate listings and as the listing broker, I was entitled to the benefits
of my (or my agents) listings.
Listings and their promotional value helped me find buyer leads for any
listings I might have, and because I was a member of the MLS (which was
once a unilateral offer of sub-agency, and since the late 1980s a
“unilateral offer of compensation”), buyers for listings of other broker
members of the MLS.
If I had a listing, I could advertise the listing (when and where I deemed
appropriate) and when calls came in (leads) I could begin to work with the
caller by inviting them into my office to meet and discuss the listing they
called on or perhaps other properties in which they might have an interest.
This might include other brokers’ listings as well as my own. I had no
obligation to give the name and phone number of the listing broker when I
provided listing information to a prospective buyer who came into my office.
When I took a prospective buyer out to look at property, I had no obligation
to give the prospect the name or phone number of the listing broker. I
simply “showed” the property and provided information, answered questions,
etc. If the buyer said: “This is great, now please give me the name of the
listing broker so I can have another broker write an offer,” I was under no
obligation to provide that information to the buyer.
Once again, and this is an important concept, the listing itself has a
promotional value that we all recognized and of which, only the listing
broker could take advantage. Listing brokers had no obligation to let
competitors benefit from the promotional value of the listings they worked
to obtain. Listings are the property of the broker. Licensees learn this
fundamental concept in pre-license classes and the Internet and web do not,
because of their existence, change this very foundational aspect of the real
estate business, regardless of what supposed consumer advocates, technology pundits, or other special interest groups might tell us. As a matter of
fact, advertising another broker’s listing without the listing broker’s
permission was and still is a violation of law and/or regulations in most
jurisdictions. Some now say that not to promote listings on as many web
sites as possible could somehow be interpreted as a breach of fiduciary duty
to the seller.
Prior to the Web, when you took a listing, did you advertise it in every
newspaper, every magazine? If you did not advertise a listing in every known
publication were you (and are you today) breaching your fiduciary duty to
the seller? When a broker takes a listing, the seller usually agrees to
allow the broker to determine the method and means of marketing. If a breach
of fiduciary duty occurs, sellers have the right to sue. Not advertising
everywhere has never been considered a breach of fiduciary duty. Brokers
choose where and how to effectively market a listing. That is how the
business works. Advertising a listing so 1,000,000 people in India see it
does not mean that the seller will receive more for the property because
more people saw the property offered for sale. This argument does not work.
How many properties, in a hot market, have sold before the listing gets into
the MLS or is advertised in the local newspaper? If you take a listing
today, and price the property based on all available data…and as soon as
the For Sale sign goes in the ground, you have 5 offers for full price or
better…do you advise the seller to wait and not accept the offers because
the ads have not hit the paper yet? Most brokers and licensees would not
advise a seller to wait, but to act on the offers on the table.
Now roll forward to today:
Today, there are at least 3 identifiable ways to make money in real estate
sales: listing, selling, and lead generating/referring (assisted greatly today by the Internet and the promotional value of listings).
While referring to other brokers existed prior to 1992, it was not a major part of most real estate businesses (except for maybe relocation, which was usually done within the confines of particular companies).
Listing information is content and it still has that promotional value. So
who is entitled to the benefit of the promotional value created by listings?
Many are saying all brokers (and even their agents, without their broker’s
permission) have the right to display on their Web site as information, all
the MLS listings without obtaining permission of the listing broker.
While IDX requires permission of listing brokers, VOWs do not. This is a
major distinction and critical to any discussion on VOWs. Should listing
brokers have the right to “opt out” (either blanket opt out or selective opt
out) and not permit their listings and the corresponding promotional value
of their listings to flow to all their competitors? The Department of
Justice is saying brokers should not have this right to control the benefits
developed by their labor and capital…and this prohibition and business
restraint will benefit the consumer. The Department of Justice does not “get
it” and/or the DOJ has some other agenda (maybe DOJ is frustrated by actions
in Texas, Oklahoma, and Kentucky). The new DOJ position makes no sense when carefully examined and yet the DOJ will intimidate and threaten legal
action…anti trust legal action, which strikes fear into the hearts of
REALTORS. It is nothing more than bullying, but is anyone willing to stand
up to the biggest bully in the school yard? That is the current 64 Billion
As stated, listings generate leads for the listing broker and the real
estate business has always been about leads. What is one of the biggest
time-consumers in a REALTOR’S day? Prospecting, and working on the
development of leads…from cold calls to door hangers to direct mail, to
signs on listings to classified ads, to open houses…all designed to make
the phone ring or get prospects to show up. The question now is who is
entitled to the leads generated by listings?
What are you paying for your leads right now in your time and
marketing…how can you generate leads from the Internet? What will you pay for leads, in time, effort and cash? Are you paying online referral
companies such as Homegain, Housevalues, Lending Tree and others? If so, is what you are paying less or more than you are paying for “conventional”
leads (when you consider all your marketing, advertising, referral fees,
prospecting, cold calling, door knocking, etc)? It is your job to find out
what is right for you and how you fit into a changing real estate industry.
Referral models are proving to be a third major area of revenue in the real
estate sales business. Listings, Sales, Referrals.
How do many of these third party referral companies acquire the leads? Using listing data as content on their Web sites? Is this inherently good or bad for the industry?
The government is now trying to push the peanut down a particular road, for
a yet to be determined reason, cloaked in the veil of “consumer protection,”
tampering with the engine that has helped create such a good economy. The
brightest spot in the economy for a number of years now has been real
estate. Why the government hostility? Is anyone willing to stand up to the
bully? It is time to study the issues and “Take Back Your Future.”
As someone who has observed closely the evolution of listings and consumers
on the Internet since 1993, from the inside and the outside. I was
instrumental, as an evangelist and then as part of a sales force of four
(Carl DeMusz, Roy Rainey, Derry Davison, and myself) in first bringing those
listings to the Internet. I want to stress that VOWs are an important piece
of a much bigger puzzle…who will put the puzzle together first is the
question we are all looking to answer.
It makes no sense to compel brokers to share listing data if it would be
detrimental to their survival as a business. If they want to, that is fine,
but to force it by government mandate or threat is wrong.
Knowledge is Power, and knowledge is a differentiator…in a business
where success constantly requires differentiation.
Questions and Answers
Q: Why should brokers be allowed to selectively opt out of participation for
A: IDX allows brokers to opt out, VOW does not if DOJ has their way.
IDX allows for limited data fields, VOW feeds must allow all the MLS data
and not selected fields, or at least more fields, if DOJ has their way.
So if you opt out of IDX and I can’t put your listings on my site, you can
still create a VOW and put all the listings (including mine) on your site.
Your site has all the listings. I can’t afford a VOW so my IDX site has
only some of the listings because you opted out of IDX. Your site has more
content than mine. I am at a competitive disadvantage because you have my
listings to display and I don’t have yours to display. To level the playing
field, I should have the right to opt out of VOW participation selectively,
and participate in VOW with other brokers who share their listing data.
What if a particular broker has no ethics and misuses the data. You should
have the right as a listing broker not to deal with that broker
professionally. Should you not have the right to make that type of business
Opting In or Out, blanket or selectively, has its place. If the reason a
broker opts out is to force a competitor out of business, then DOJ should go
after that broker, but to say all brokers will misuse an opt out when
sellers and the government have recourse for misuse is inappropriate.
Q: If in the traditional world I can invite a consumer to my office to look
at ALL the listings in the market area (via my access to the MLS) and not be
obliged to reveal the listing agent’s name or contact information, for the
purpose of representing them on the buy side of the transaction, why not on
the Internet once I have established a ‘relationship’? The point being, in
my office I have the ‘right’ to provide ALL the local listings to them. The
listing broker cannot opt-out to allow my particular company from having
this right, if they have opted to post their listing on the MLS.
A: The Internet is NOT the conventional or traditional world. Your ability
to benefit from the promotional value of my listing is limited in a
traditional world. People must physically make it to your office and this
really does limit your ability to use my listing data for marketing benefit.
The Internet is a much different place than the traditional world and allows
for leverage never contemplated when brokers, as competitors, agreed to
cooperate and share listing inventory when MLSs were created. I should have
the right to limit your ability to use my data and hard earned listings to
your marketing advantage at my expense.
Simple answer…the Internet is not the traditional world. It is not the
same. Anybody who thinks so doesn’t understand the power of the Internet. It
is a charade to hint otherwise.
Q: I would also question the statement, “As stated, listings generate leads
for the listing broker.” Do not all REALTORS have the right to generate
leads from those listings once the listing is on the MLS and cooperation
is now offered?
A: No, No, No. That makes no sense at all. You can show my listing to your
client, but you cannot use it to generate leads, that was not and is not the
reason I cooperate with you, my competitor. It never was the intention of
MLS and never will be.
Q: Whereas I would agree with your sentiment that some have used the
‘consumers’ interest in this debate to bolster their argument, the
consumer’s thoughts, opinions and concerns on this issue should not be
ignored. As an industry we would ignore their interests at our peril. In
2005, to argue that the Internet is still just an advertising medium as
Blanche of Realty Times insists, is to totally misunderstand what the
consumer thinks on that issue. We talk to 300-400 consumers a day on behalf
of our REALTOR members and I can tell you that they think that the agent’s
Web site they are visiting should be doing exactly what a visit to their
office would be able to do and more. It is why they are using the Internet.
They do not want to go to the office. That was yesterday.
A: The consumer does not always get what the consumer wants, nor should
they. I am a consumer of computers and I think IBM should give laptops to my
staff for free. That is an obvious unrealistic “want” and easy to understand
how IBM would be under no obligation to give me (the consumer) what I want.
While it is a little more subtle in the areas we are discussing, it is still
the case. The consumer does not always get what they want. Consumers want
all brokers to provide full service including fiduciary responsibilities and
not charge more than $500 to list and sell a home. They can “want” all they
want. If consumers want advanced technology available at Web sites, then let
brokers offer it and they will prosper and those who do not offer it will
perish…let the market take care of itself…but this strays from the
listing question. If I take the listing, pay for pictures and virtual tours,
advertise in newspapers, put up signs, etc…all on a contingency of payment
(commission), I should have the right to decide if I want my competitors to
use my “capital” to their advantage. If I want to fine, if I don’t want to,
that should be fine as well and if consumers don’t like it, they can list
somewhere else…it is a free country…or at least it should be.
Q: In an MLS, are we not cooperating to bring buyers to the seller?
You have the listing and I have my source of clients. I will show them what
listings I want to, and if you and I have been cooperating with each other
and you are offering a reasonable split on the transaction, I will bring the
buyer and my work will be equal to your work by potentially attracting the
buyer. You win and I win – real cooperation.
A: No, I am going to work to sell the listing myself, or have an agent from
my office or branch office sell it. You are an agent of “last resort.” I
have selling clients as well…and I want more selling clients and my
listings allow me to attract selling clients. I am in the “selling client”
business as well as the listing business. Also, everyone knows I work much
harder than you so I will end up doing a lot of your work. Cooperation does
not mean compensation – we need to make sure we are clear about that. As a
member of the MLS, I agree to making you an offer of compensation.
Q: You and I have often had a coffee together and visited each other’s open
house walk-throughs and my understanding was that you wanted me to bring my buyers to the table. Why do you now want to make it so difficult for me to
do that? If what you are saying is that you are only doing all of this so
that you can have me do all the work with the buyer, but in the end they ditch
me and call you, well, I don’t know if I find that very cooperative?
A: Don’t mistake my good nature for charity. This is a fiercely competitive
business. I can be competitive and drink coffee at the same time. Also don’t
mistake cooperation with friendly. I can be cooperative in the transaction
and not be friendly.
Q: If I take the listing, pay for pictures and virtual tours, advertise in
newspapers, put up signs, etc…all on a contingency of payment
(commission), should I have the right to decide if I want my competitors to
use my capital to their advantage?
A: Yes you should.
Real estate compensation is “contingency based.” Brokers and Agents “work
for free” most of the time.
Brokers only get paid if the listing sells. If it does not sell, they have
invested not only time but cash. When brokers list, they work on a
contingency. Most other occupations that work on contingencies charge a lot
more than 6%. Attorneys charge 30% to 50% when they work on a contingency
— Saul Klein, Internet Crusade
I believe for every drop of rain that falls, a flower grows… I believe that somewhere in the darkest night, a candle glows…
1. Aggregator Portals are vulnerable and at multiple risk.
2. The Portal’s relationships with MLSs, in general are weak at best.
3.Data received by portals from syndicators is subject to rule changes and restriction on use (possibly on very short notice).
4. Listhub is owned by Move (a major competitor to the portals), which is a risk for those portals dependent upon their competitor for the oxygen they require to live.
5. The portals are reliant upon MLS (free) data to build commerce.
6. The data should no longer flow free of charge from MLSs to these portals.
This all adds up to extreme vulnerability for the portals and opportunity for brokers, agents, MLSs, Associations and ultimately, buyers and sellers of real property…at least that s what I believe.
Games, real estate, and the WWW…
The big real estate portals are really “Game” sites. I have said this before but I will keep saying this to drive the point into everyone’s heart.
Just as Ancestry Dot Com is a “Game” site that is not recognized by most as a “Game” site…it is true with the major real estate portals as well. They are game sites, not recognized as game sites.
A major point that has led me to this conclusion about real estate portals are the traffic counts continually boosted by the portals, traffic counts on the order of 60 Million Unique Visitors per month (or more).
But how many actual real estate transactions are there in the ENTIRE year?
According to NAR, about 6 Million Annual Transactions. So most of these visitors to real estate portals are not buyers…and yet we are allowing these portals to establish relationships with consumers far in advance of a purchase, using your listing information as the “bait.”
Changing rules of data display will not affect serious buyers, only gamers. This bears repeating: Changing rules of data display will not affect serious buyers, only gamers.
So, as Denver Metrolist is looking at making changes to the distribution rules to public portals, so should all MLSs, Associations, and brokers look to make changes to their existing data distribution rules. Changing rules of data display will not affect serious buyers, only gamers.
There is a movement afoot among Multiple Listing Service (MLS) executives and brokers across the country to take measures to protect, control, and monetize the very valuable asset they guard – namely, the data surrounding listings. A key component of this strategy is the consumer-facing MLS website, also known as the MLS Public Portal.
The idea behind a MLS public website is not new. In a 2009 study of MLS public listings websites, Matt Cohen, well-regarded technology chief for Clareity Consulting, said: “I have been an advocate for MLS websites that provide real estate listings information to the public since 1996. Such websites have always made sense as a hedge against industry outsiders that want to intercept the consumer on their way to the real estate professional, selling expensive advertising, charging referral fees and/or reducing the broker’s capability to provide a one-stop-shop for services ancillary to the real estate transaction.”
In 2009, Clareity Consulting studied every MLS listing website in the United States and found most of them to be severely lacking in features and deficient in other criteria. Clareity updated their study in 2011 and again in 2013, evaluating the listing websites of the top 100 MLSs by size. Of these MLSs, 63 had listing websites, which collectively represent approximately half of the residential listing content in the United States. Links to each of the Clareity Consulting Studies are provided at the foot of this article – we’ll take a look at some of the highlights here but we encourage you to take the time to read them in full.
Historically, MLS vendors have not focused on the development of MLS public websites and some of their offerings were an afterthought and lacked the content and features found in the national portals. The websites and search components provided by vendors were often free and very basic so MLS operators that wanted a more robust public site retained a local or national website vendor or hired staff to develop it themselves.
Today’s consumers visit many sites and expect more than a basic system. They are not likely to return to a site just because it is provided by the MLS for the reason that the listings are in many places where additional content and advanced features provide a better search experience and superior analysis tools and reports.
Clareity’s 2013 Update stated that: “In order to field highly functional websites, most of these MLSs have moved away from the free websites provided by MLS vendors. A few have improved their websites’ capabilities by purchasing a premium website from their MLS vendor, while 29 % have either developed a custom website by themselves or with technology partners and 61% have leveraged the capabilities of IDX vendors.”
A good example of a Realtor-friendly consumer website was recently launched by the San Francisco Association of Realtors® at the mobile friendly www.sfrealtors.com that will soon add local videos to their Neighborhood tab.
Both the 2011 and the 2013 studies addressed the main features of a well-designed MLS public website. Here’s a quick look:
- Finding Properties (Search) – There is no good reason not to provide either ‘count on the fly’ or its visual equivalent, where listings are shown on a map as criteria are changed.
- Search Filters/Content – Only 16% of sites allow you to search for pending or sold listings, useful when you want to look at comparable properties. It seems likely that in the future, to remain competitive with national listing advertising sites, more MLSs will allow for local display of pending or sold listings and/or display that information via public records display.
- Open House – 70% of sites have some kind of open house search, either integrated directly into property search or available as a separate search from the site’s top-level menu.
- Details About Individual Properties – The simplest and least sophisticated implementations of property maps are simply links to Google Maps or another online mapping application, or popup windows in which such links are loaded. Better implementations use their own map data, overlaid with their own points of interest. The advantages of having many pictures of a property rather than one should be obvious. Nonetheless, 9% of top MLS listing websites still show only one picture per property. “Virtual tours” were a hot idea years ago, but the implementations mostly looked like slideshows with perhaps a little wiggle here and there to simulate motion. Most virtual tours still have that limitation, and are displayed by only 13% of sites.
- Personalizing Your Searches – 46% of sites allow the consumer to save searches, 24% allow the consumer to receive email updates on properties and 24% allow the consumer to compare listings side by side. Features allowing consumers to save searches and/or listings and receive email updates are crucial for the long-term usability of the website by consumers and should be implemented by more than a minority of websites.
- Sharing and Printing Properties – A supermajority of sites (73%) allow you to send an email with a listing to a friend, and a similar number (78%) give you a version of a property detail page that is formatted so that you can print it easily. 45% of sites let you post a link to a property detail page to social media sites, such as Facebook and Pinterest, so that you can share the specs on that dream house with your friends.
- Neighborhood Features – Although having a full range of visuals and data about a home’s immediate property is undeniably the central issue for homebuyers, most also would like to have a clear sense of the home’s neighborhood. In this respect, most MLS websites provide scant information, and would do well to beef up their offerings. Similarly, MLS websites provide prospective homebuyers with little information about the neighborhoods themselves. Providing information beyond the listings themselves – especially neighborhood and points-of-interest information – is absolutely critical for MLS websites that wish to be competitive.
- Visiting and Choosing a Property – Once a homebuyer has identified several properties of interest, he or she may want to compare their features. Currently 24% of MLS sites enable browsers to compare properties side by side.
- Costs of an Individual House – Information about comparable sales, a house’s sale history, and local market trends can help a buyer make an informed decision. Unfortunately, only 27% of sites offer historical and statistical information.
- Advertisement and Policies – Advertisements are a way for an MLS to monetize its site and connect consumers with services they may need during the home buying process. At the same time, they may detract from a site’s appearance of objectivity and authority. 16% of sites display advertisements.
- Appearance of Sites – Use white space and “normal” size fonts as appropriate. Don’t treat the listing page like a data dump. You are not paying by the pixel. Make it easy for people to read the listings.
- Accessibility – International buyers and non-English speakers represent a growing number of purchasers of U.S. homes, especially in multicultural markets such as New York, Texas, and Florida. Public MLS sites that present a user interface in a buyer’s language have an advantage. Only 8% of sites currently offer multiple languages, up from under 1% in 2009.
- Mobile – In 2009, the category of mobile real estate sites did not exist. Today, technology companies sell more mobile phones than computers. The real estate industry has simply not caught up; it is seriously lagging behind. Less than 50% of MLSs have mobile sites. This is a missed opportunity and a crucial area in which MLSs must rise to the challenge, given that, according to NAR, 61% of consumers on a tablet or phone who visit a website that isn’t mobile friendly leave the site immediately and may never come back.
- Search Engine Optimization – Only 36% of MLS sites received a PageRank of 4 or 5 and others were even lower. This is not particularly good, considering that PageRank tops out at a rating of “10.” Only 41% of sites studied had listings indexed by Google! The benefits afforded by having all of the listings indexed and the “long tail” search should not be underestimated. A prime example of the high rankings that can be achieved by a MLS public website is the Houston Association website at www.HAR.com
- MLS Data Security – While consumers are the main audience of your MLS listings site, there is another hidden audience, one that you don’t want. “Scrapers” are scanning your site, copying your data, and using it or reselling it for unlicensed purposes.
Realtor friendly MLS public websites are a big part of the movement to protect, control and monetize the data. Our hats off to Gregg Larson and Matt Cohen and the Clareity Consulting team for their monitoring of the evolution of MLS public websites.
TheDataAdvocate – MLS Public Websites
Data needs a voice, and that is why we decided to create this blog. We will be bringing you conversation and resources that we believe are relevant to the Data Conversation playing out in the real estate industry today…so bookmark us and come back often.
- TDA Team
- April 1
- Artificial Intelligence
- Data Licensing
- Design Lab
- Domain Names
- Dot REALTOR
- e Commerce
- Education & Training
- IDX (Internet Data Exchange)
- Language of Real Estate
- Listing Syndication
- Machine Learning
- Major Real Estate Portals
- MLS (Multiple Listing Service)
- Online Sales
- Organization Of the Real Estate Industry
- Paradigm Shift
- Personal Branding – Domain Names
- Personal Information
- Public Portals
- Random Thoughts
- REALTOR Association Buildings
- REALTOR Associations
- REALTOR Buildings
- Realtor Information Network (RIN)
- Risk Management
- Sales and Selling
- TECHNOLOGY TIMELINE