The housing market depends on a smooth, functioning Multiple Listing Service that effectively compiles home listings data and redistributes it back to its real estate agent and broker members. For an MLS to function properly, competitors have to cooperate to meet a common goal.

However, cooperation in some markets is fading as the struggle over politics and listings control grows louder and the stakes become higher. Without broker cooperation, the future of the MLS is uncertain, as we’re seeing in Chicago with the Multiple Listing Service of Northern Illinois.

But Chicago is not alone in its struggle. MLSs nationwide share the same pressures of having to serve all members and appease brokers and shareholders, which often are Realtor associations. MLSs have become huge companies with large sums of money at stake and strong demands for the real estate information they hold. The key to an efficient housing market is for the MLSs not to become distracted by the forces working to pull them apart.

“The whole point of the MLS is the efficiency of the marketplace,” said Pat Bybee, CEO of Metrolist, a Colorado MLS. As the chief of a 16,000-member MLS, Bybee’s all too familiar with the challenges the organization faces.

In the last few years, the Internet has only heightened the control issue among MLS broker members. As a matter of business, some brokers prefer not to display their listings on other brokers’ Web sites or an aggregated MLS Web site. We saw this happen in Chicago, where a recent demand by MLSNI brokers to shut down the MLS’ consumer Web site ChicagoMetroRealEstate.com was met. The Web site enabled consumers to browse all the MLS home listings on a neutral Web site, without first having to go through a broker or franchise site.

Online listings is a touchy subject. Some brokers adamantly oppose the MLS handing out their listings information to anyone or any outlet except for those the broker controls. Listings are a lure brokers and agents use to attract online consumers to their Web sites, and the fueled debate over who’s allowed to display and who’s not is indicative of the ongoing industry struggle to be the consumer’s first point of contact in a real estate transaction.

But the listings struggle isn’t the same across all markets. Some markets, such as Houston, have complete broker participation in IDX (Internet Data Exchange), which enables them to display each other’s listings on their Web sites.

“No broker has not participated (in IDX). It’s been a huge success,” said Bob Hale, CEO of the Houston Association of Realtors, which operates Houston’s MLS. “There is very good cooperation among the brokers in Houston.”

While broker control and the listings struggle concerns MLSs nationwide, it’s not the only point capable of pulling apart an MLS. Bybee points out that when MLSs have to deal with overheated political issues that arise, the fundamental business operations fall to the wayside.

“Probably every MLS can give you an example of when they stopped dead in their tracks to deal with a political issue,” she said.

Often it’s the Realtor associations and shareholders that precipitate political battles, not the brokers trying to maintain control over their data.

Add to that the demands made on MLSs for the valuable information they possess, whether it’s content licensing deals with Realtor.com or local newspapers, the MLS is always being pulled from all sides. The consolidation over the years of many local MLSs into single regional MLSs has only made them larger, more complex and more prone to controversy.

***

Send tips or a Letter to the Editor to jessica@inman.com or call (510) 658-9252, ext. 133.

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