The coming year will see an increased scrutiny of the value of real estate listings syndication; a renewed debate around broker control of listings data and its distribution channels; and a rising demand among consumers and real estate professionals for higher-quality data, according to more than a dozen industry experts contacted by Inman News.
A coming wave of syndication withdrawals?
In November, HomeServices of America subsidiary Edina Realty Inc. announced plans to pull listings from Trulia and Realtor.com, reigniting a debate over the pros and cons of syndicating listings to third-party sites.
Edina Realty’s syndication withdrawal may be among the first in a coming wave where brokerages and multiple listing services decide to syndicate real estate listings only to sites that provide the most value, some experts said.
Edina’s move, and a similar withdrawal by Shorewest Realtors in 2010, may be "just the tip of the iceberg," said Michael Audet, founding partner at WAV Group, a real estate consulting firm.
"I think the broker industry is and will take a serious look at the entire issue of syndication. There is a growing concern that the return on value from third-party sites like Zillow and Trulia is just not there," Audet added.
Bob Peltier, Edina Realty’s president and CEO said, "I just don’t see the value for our company to continue to support that business model. (Third-party real estate search sites) are not brokers. They’re not in the (brokerage) business. Their model is to sell advertising to anybody that will buy it."
The brokerage has thus far pulled its listings from Trulia, though the companies have devised a workaround that allows Edina agents to submit their own listings to Trulia if they choose. The brokerage is attempting to negotiate a similar workaround with Realtor.com before pulling its listings from that site.
Mark Weiss, director of business development at Trulia, anticipates listings syndication will be among the most controversial data issues in 2012.
"Some brokers (will decide) not to syndicate at all in an effort to force consumers to their site for information, while others take the opposite approach trying (to) capture consumers online that brokers who are not syndicating have ignored," Weiss said.
"The focus for real estate professionals should be getting their listing data to the most qualified homebuyers and sellers in the most cost-efficient method possible," he added.
As the value of listing data is further assessed in 2012, multiple listing services may decide that value is worth a price, some experts said.
"As (brokers and MLSs) are digging into licensee business models and understanding how much money is being made — and that they have zero piece of that pie … the potential for increased data costs to licensees or revenue-share demands is very palpable in the near future," said Kim Cipriano Prior, senior vice president of marketing and MLS market development at real estate data company Onboard Informatics.
Taking control of listing data
Rather than distributing their listings "anywhere and everywhere," brokers are taking back more control of where their listings are distributed, said Charlie Young, president and CEO of Realogy Corp. subsidiary ERA Real Estate.
"The reason for this is simple: If you don’t know where your listings are appearing, you can’t track them and therefore you can’t pinpoint critical marketing metrics such as cost per lead, cost per transaction, and lead sources. Being able to articulate these metrics as a key component of your value proposition to both agents and consumers is critical," Young said.
Saul Klein, senior vice president of listings syndicator Point2, expects syndication to veer toward "report card-based syndication" based on performance, or "criteria-based syndication" based on conditions dictating what can and cannot be done with feeds of listings data.
"Control will be a key issue with data providers, as they will expect and demand that they know and control — from all data display entities — where their data is being displayed; what the source of the data is, if not directly from them; what happens to the data when no longer active; and reporting on consumer interactions with that listings data," said Errol Samuelson, president of Realtor.com.
Nonetheless, Samuelson predicts "technology and industry-friendly innovations will offer solutions that will ensure listings maintain their integrity and brokers manage and maintain control of their listings content."
MLS data pirates
Brian Larson, president of consulting firm Larson/Sobotka Business Advisors LLC, anticipates more MLSs will go after "data pirates" who redistribute licensed MLS data without authorization.
"We are working with some clients now to evaluate effective ways of shutting down folks who steal data from listing brokers and MLSs. I’d expect some news on this front in the first quarter," Larson said.
Realtor.com’s Samuelson noted that Realtor.com has seen 1 million separate attempts of data "scraping" on the site over the last 30 days.
"While Realtor.com has sophisticated technologies to block these attempts, the vast majority of third-party, broker, agent, and MLS public websites do not. Brokers need to choose a syndication source for their listings data and make sure none of their vendors or agents are syndicating data through other means," Samuelson said.
"MLSs can play a role as well in making sure that vendors — IDX (Internet Data Exchange) companies, CMA (comparative market analyses) suppliers, etc. — are not violating their MLS agreements by resyndicating the data that is being provided by the MLS for a certain purpose.
"Brokers and agents should only work with sites whose practices or business models match their values and needs."
Syndication via social media
In November, NAR’s Multiple Listing Issues and Policies Committee approved, in concept, suggested language to broaden the group’s IDX policy to give members the right to display shared listings data from their MLS through mobile apps and social media, though it rejected language that would have allowed display through RSS feeds.
"What will it look like? How will brokers and agents manage data on these sites? Will they lose more control or is it no big deal? I think it will be a hot topic as it unfolds," WAV’s Audet said.
Increasing consumer demand for more, better, meaningful data
As real estate leaders tackle larger policy issues this coming year, real estate professionals and consumers on the ground will demand more and higher-quality data to help them gauge the state of the housing market and when it might reach that elusive "bottom," several experts said.
"In time of continued anxiety, people are looking for glimpses of hope in home sales and price(s), and foreclosure activity," said Avi Gupta, vice president of marketing and operations for predictive marketing company SmartZip.
Consumers and real estate professionals will also be hungry for reliable and accurate home valuations, forward-looking home-price indices, sold property data, and listings history data that includes a property’s sales history, price changes, and dates on and off market, experts said.
"I believe consumers will be looking for more historical records on the properties for sale to help them make more informed decisions in the homebuying and selling process," said Cary Sylvester, executive director of technology at Keller Williams Realty International.
Any third-party or industry sites that offer such data will have a "leg up," said Gregg Larson, president and CEO of Clareity Consulting. "Consumers will find the history invaluable and return to those sites that offer it," he said.
Both consumers and real estate professionals will want data that is in real time, experts said, or better yet, predictive.
"The media, agents, and consumers are frustrated by how much market data is reported with a lag and tells us what has already happened. The major home-price indexes report on market conditions that are several months out of date by the time they’re published," said Jed Kolko, Trulia’s chief economist.
"Consumers and the industry will value any forward-looking data that shows what will happen to housing demand and supply in the near or distant future."
Clareity’s Larson said he expects agents’ ratings will become hotter in 2012, especially those that combine data on agent productivity and customer satisfaction.
"Eighty-one percent of consumers want agent ratings, but only 14 percent of agents like the idea. More agent ratings will evolve in 2012, and many agents are in denial … hoping (the ratings) will go away. They won’t — it’s just getting started!" Larson said.
A deluge of data
As real estate data proliferates, data providers that best define their methodologies and standards will dominate in 2012, said Greg Sax, communications director at Minneapolis Area Association of Realtors subsidiary 10K Research and Marketing.
"It’s not enough to just provide numbers. Real estate professionals and consumers alike want context and they want to trust what they are looking at," Sax said.
Nevertheless, the deluge of data will also give real estate professionals a chance to show off their expertise to consumers, said Jonathan Hill, president of RealEstate Business Intelligence (RBI), a subsidiary of Mid-Atlantic regional MLS MRIS, among the largest MLSs in the nation.
"Smart real estate professionals understand that ‘data’ — the bits and pieces we collect every day — is best conveyed to consumers as information, giving those pieces context and perspective: How does this year’s median sale price compare to last year’s? They can then convert that information to market knowledge: Median sale price increases mirror market activity levels," Hill said.
"What consumers really want is the story — the analysis — of what is happening and why."
Additional commentary from industry experts: