WASHINGTON – A committee in charge of recommending policies to the National Association of Realtors’ board of directors has removed language from a controversial policy amendment that would have allowed multiple listing services to charge all members for the costs of establishing and promoting public-facing websites.
NAR’s Executive Committee has pulled language stipulating that the “establishment, maintenance or promotion of public-facing websites” be included on a list of services that MLSs should be allowed to define as “basic,” according to NAR Director Shad Bogany, chairman of the Texas Association of Realtors.
Bogany serves as a member of the Multiple Listing Issues and Policies Committee, which on Thursday approved a proposed amendment to NAR’s model MLS rules that would have made that and other changes.
The Executive Committee said it would recommend revisiting the issue of public-facing websites at NAR’s annual meeting in November, Bogany said.
None of the other changes the MLS committee made to the policy amendment yesterday were removed, he added.
Bogany is not on the Executive Committee, but said he was told of the committee’s decision from a committee member. He declined to reveal the member’s name, saying members must sign confidentiality agreements to participate. NAR’s Executive Committee reviews policy recommendations from the trade group’s other committees and recommends to the board of directors new policies, changes in policy, or the repeal of existing policies.
The amendment goes to NAR’s board of directors for a vote Saturday morning.
As a member of the board, Bogany said he would push to get the public website provision put back on the amendment, bring it to the floor and have the board vote on the amendment as it was when it came out of the MLS policy committee.
Bogany said he was stunned that the Executive Committee did not make public-facing websites even an “optional” service that MLSs could offer to members and charge only those who use it, but rather removed any mention of public-facing websites at all.
“That’s what the big brokers wanted all along,” Bogany said.
“They used the other items as a smokescreen,” he added, referring to a debate about whether lockboxes should be categorized as a basic or optional service.
A small minority of large brokers want all consumer leads to go through them, so they can show agents more value and charge more fees, Bogany said.
“It’s all about making more money,” he said.
Those brokers are under the mistaken belief that if there were no public-facing MLS websites, consumer traffic would flow to them, Bogany said, but studies have shown that’s not the case even if a broker is dominant in their market.
“The consumers are still going to realtor.com and the Zillows and Trulias of the world because they want a neutral place to go. They don’t want to go to your site and think you’re trying to sell them something. They perceive these third-party aggregators are neutral,” he said.
“They might believe if they go to my site they’re seeing only my listings. They might think these third-party sites have all the listings. (And) they don’t want me calling them unless they want to be called.”
The change is not what’s best for the agent or the consumer, Bogany said.
Consumers want their listings everywhere, he said, and agents want their MLSs to help them be profitable.
“It is about the consumer and it is about the membership and that’s what bothers me: Nobody’s speaking about what’s best for the consumer or what’s best for the members who we’ve been elected to come up here and represent,” Bogany said.
Craig Cheatham, president and CEO of the Realty Alliance, an association of 70 U.S. brokers, said this morning that the MLS policy committee’s version of the amendment was not sound policy.
“We were disappointed in how the (MLS policy) committee meeting went because instead of crafting good policy it became a rushed referendum on public sites controlled by MLSs versus not,” he said.
“That really wasn’t supposed to be the question. It was about ‘Is this a well-worded, sound policy and have we properly thought through and assigned what MLSs can charge their participants for and what they cannot, and what could be imposed on participants and what should be optional?'”
Because there was an “artificial sense” in the meeting that they had to pass something that day and not refer the policy back to the committee’s advisory group, the resulting policy was “flawed and perhaps dangerous and certainly may not reflect the intent of the members of the association and participants of the MLS,” he said.
He said the board of directors should send the policy back to committee “to get it right.”
For instance, he pointed to language in the policy that said basic services are those that are “substantially related to the purpose and functions of the MLS.”
“We don’t even agree on what the function and purposes are,” Cheatham said.
Cheatham had not immediately returned requests for comment on the Executive Committee’s decision by publication time.