Local and regional collections of for-sale property information that are separately maintained by dozens of multiple listing services in California would become available on a statewide basis to agents and brokers under a plan that is under consideration by the California Association of Realtors, and the group’s leaders are also considering a more comprehensive plan to build a consolidated statewide MLS.
Members of the association’s board of directors, at a meeting earlier this month, approved an engineering effort that will map data fields from MLSs throughout the state and lay the groundwork for either of the two options: a statewide data aggregation service or unified MLS.
During a meeting earlier this month, leaders for the state Realtor group approved up to $500,000 to support an “information engineering” effort that will provide the basis to develop statewide standards for MLS content and will also serve to facilitate either of the two options for the future of the state’s MLS information and structure.
Association officials are expected to vote on which alternative to pursue at a meeting in October. Participation in either plan would be voluntary.
The Realtor group will look at examples of MLS consolidation and data aggregation efforts that are already in progress in the state. Other examples of statewide MLSs and large-scale regional MLSs are operating across the country, and the National Association of Realtors is considering plans for a national real estate data repository that would include information for all types of properties and could serve as a building block for a nationwide MLS.
While brokers and agents may favor such plans as a way to eliminate costs associated with membership in multiple MLSs and avoid separate sets of MLS rules and standards, there are also technical and political complications in sharing data among MLSs and in combining MLSs.
“We have a reasonably small company, and I think we belong to eight or nine MLSs. That’s insane,” said Colleen Badagliacco, a broker-owner for RE/MAX Valley Properties in San Jose and 2007 president for the California Association of Realtors.
Brokers and agents in the state, she said, are largely supportive of plans to simplify this problem of multiple MLS memberships.
“Everybody’s very engaged in the conversation. I think people understand it,” she said, adding that the existing system can be “a little arcane” at times. “I think everybody wants to make sure (this process is) done in a fair and transparent and open process.”
While there was “spirited discussion” about how to proceed at the association’s board meeting this month, Badagliacco said, “When we got to vote, support was overwhelming” to pursue the engineering plan. “It was not tepid in the least.”
A study prepared by consulting group Innovative Solutions for the California Association of Realtors estimated that a statewide MLS data aggregation service, which would make available all of the active listings and associated content from the 70 MLSs in the state, would save brokers about $2 million to $4 million per year and would save an additional $2 million to $4 million per year for other users.
“Agents would no longer have to pay separate MLS fees to search data in other MLSs and an estimated $2 million in MLS participant/subscriber fees would be eliminated,” according to the report. The greater efficiencies of this system could allow higher fees to help offset the costs of operating this data aggregation site, the report states, and the system is expected to cost about $5 million per year to set up and operate.
The other option, a unified statewide MLS, “would consolidate the current 70 MLSs … into one organization, one service.” Under this plan, local Realtor associations could serve as local service enters and the central MLS would provide customer support. Creation and operation of this system is expected to result in $52 million per year in savings to MLS subscribers in the state, according to the report.
A statewide MLS, according to the report, would require a database that could handle 300,000 active listings, 8.1 million historical listings, 50.4 million photos, 13 million public records, and could handle up to 50,000 simultaneous users — the state Realtor group has about 185,000 members.
While both plans offer cost savings and greater efficiencies, “the barriers to either or both of these beneficial services are local organizations’ unwillingness to cooperate and cede local control. There is a greater chance of creating the statewide aggregation service than the statewide MLS,” the report states, as the aggregation service “does not threaten local organizations like the statewide MLS.”
Badagliacco said that the agents and brokers are the consumers in the discussions of MLS reform, and “we’re saying, ‘This is what we need.'”
There may be some pain ahead for MLSs and MLS vendors, depending on which option is selected, she said. In the case of a unified MLS, there would likely be job losses, she said. “The dark side is jobs — personnel and jobs. Nothing comes without a price.”
The California and national Realtor groups’ efforts have similar aims, Badagliacco said, and “are not in conflict and are certainly not in competition.” Gary Thomas, chairman of the National Association of Realtors’ MLS Future group who has also been involved in the California effort, was not available for comment.
In addition to authorizing money to pursue the information engineering effort in California, the state Realtor association’s board also voted to conduct a thorough review of regional MLS data-sharing and consolidation plans under way in the state, including efforts such as Quattro and NCREX in Northern California and Common Database Utility in Southern California. The association’s initial effort, she said, “isn’t looking to duplicate or compete with existing efforts.”