SAN FRANCISCO — The National Association of Realtors (NAR) did not change its classification guidelines for MLS “basic services” at its annual conference, ensuring that, for at least the near future, multiple listing services (MLSs) may confidently charge all their members to operate public-facing websites — a practice that has riled some large brokers.

Asked of his reaction to the committee meeting, Craig Cheatham, CEO of The Realty Alliance, said that public-facing sites should be switched from “basic” to “optional” in NAR’s MLS service classification guidelines “immediately and without hesitation.”

“Giving the committee and the board of directors the benefit of the doubt, they simply must not understand the stakes of what they have done and the direction they continue to head,” Cheatham said. “Our conscience is clear. We have sounded the alarm loud and clear. We were optimistic for progress, but actions speak volumes.”

In an announcement that has kindled anxiety among MLSs, Cheatham recently announced that The Realty Alliance is planning to roll out an unspecified “big initiative” to address some brokers’ concerns with MLSs.

Some brokers have clamored for NAR to remove public-facing websites from a list of examples of services that it considers reasonable for MLSs to choose to offer as “basic services” — MLS services that all members are required to pay for in their dues — ever since NAR added them to the list in May.

The inclusion of public-facing sites in a list part of MLS Policy Statement 7.57, “Categorization of MLS Services, Information and Product,” allows MLSs to force their members to pay for a service that can compete with their own websites, those brokers say.

“How can boards and MLSs take dues from all and spend those dues to injure our agents’ ability to win business?” said Rick Haase, president of Latter & Blum Inc., a New Orleans, La.-based real estate company that claims to have close to 1,300 agents. “It is well past time to stop this madness.”

Instead of voting to tweak NAR’s classifications of “basic services,” the Multiple Listing and Policy Issues Committee sought to gather more feedback at a meeting it hosted on MLS issues at the Realtors Conference and Expo in San Francisco.

Cliff Niersbach, vice president of board policy and programs at NAR, said it was clear for at least a week before the conference that the committee was unlikely to hold a vote on any proposed changes to its classification guidelines for MLSs.

The MLS Technology and Emerging Issues Advisory Board needs to gather more input from industry stakeholders before it can make any recommendations for potential tweaks to Statement 7.57, according to Greg Zadel, the advisory board’s chairman.

But the meeting did provide a window into the committee’s current line of thinking on the issue when it presented a list of more flexible basic service categories that it said is under review.

“The shorter the list, the more logical, because it will change daily,” Zadel said.

The list was generated by the MLS Cooperative Venture (COVE) and contains the following categories:

  • property-related information for brokers and agents.
  • information and tools needed by agents to meet clients’ needs.
  • information and tools needed to improve efficiency.
  • training, support and education.
  • broker and agent tools to connect brokers and agents with consumers.
  • technical applications and software.
  • MLS rules and policies; legal and security.

That list, if adopted, might supplement the existing one (which is meant to offer specific examples of basic services) with all-encompassing categories of services that could absorb or reject new technologies.

Specific examples on the existing list include: expired listings and “off market” information, tax records, zoning, amortization schedules, mapping capabilities and affinity programs.

Some attendees balked at the prospect of adopting more flexible categories to cover basic services, suggesting that it would give MLSs even more freedom to charge all members for more services.

“No. 5 could be completely open-ended,” one member said, referring to the proposed category of “broker and agent tools to connect brokers and agents with consumers.”

“It could be anything,” he said.

Others thought the committee was getting ahead of itself by discussing the composition of a list.

Haase said that NAR should first determine whether MLSs should be able to charge all members for any tools and services at all, other than its core functions.

NAR “has absolutely no business endorsing, through its lack of regulation, the practice of using its members dues to create public-facing websites and their associated tools,” Haase said.

Many large brokers that invest in tools and websites for their agents share that sentiment. And it’s partly what has prompted The Realty Alliance to prepare the unspecified “big initiative” to address MLS concerns that Cheatham recently announced.

The group, which represents dozens of large brokerages nationwide, outlined those concerns in a list of grievances that largely focused on the services provided by MLSs to their members, many of which brokers perceived as undercutting their business. 

“You’re actually competing for traffic that I’m paying millions for,” Haase said, directing his statement to MLS executives in the room. “And to add insult to injury, you’re using our dues to do it.”

“You do not need to be in the business of competing with my websites,” he added.

Niersbach cautioned not to read too much into the list of basic service categories that Zadel presented.

“There are no assurances that those are going to go anywhere,” he said.

The MLS committee may vote on some revisions or enhancements to NAR’s guidelines for MLS services at its next meeting in January, Niersbach said. But he doesn’t think those potential revisions would switch public-facing websites from “basic” to “optional” in NAR’s classification guidelines for MLS services.

“I can’t say there’s any inclination to take that off,” he said.

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