At a much-anticipated special meeting in Chicago, the board of directors of the National Association of Realtors voted today to give realtor.com operator Move Inc. more flexibility to publish listings from sources beyond those provided by Realtors, including additional new homes and rental properties.
“It’s going to give the consumers what they’re looking for that they haven’t been able to find on the realtor.com site that they have been able to find on other sites. We wanted to make sure they found everything they needed in order to fulfill their American dream of homeownership,” NAR President Gary Thomas said.
“With the resounding vote we had today, I think the vast majority of NAR members are going to find this to be a benefit because their preferred site, the one with their brand on it, is going to be more competitive now.”
In a voice vote, the board approved amendments to the realtor.com operating agreement between NAR subsidiary Realtors Information Network (RIN) and Move subsidiary RealSelect that would allow Move to obtain listings from entities that are not Realtor-owned and controlled, and from brokers who are not Realtors.
This will allow realtor.com to source listings from areas it hasn’t been able to in the past, including multiple listing services not affiliated with NAR. For instance, Seattle-area Northwest MLS is not Realtor-affiliated and therefore the site is currently pulling in listings only from the MLS’ Realtor members, not all of its members.
The amendments would also allow realtor.com to display rentals, new homes and new-home communities not listed by Realtors on realtor.com.
Allowing the display of for-sale-by-owner properties on realtor.com was “not on the table,” at today’s board meeting, Thomas said.
“Today’s historic and collaborative recommendation from the NAR board members empowers us to further expand and enrich the consumer experience on www.realtor.com and its mobile applications with greater breadth of content, and to do so with our continuing commitment to the highest level of quality and accuracy for both the real estate community and consumers,” said Move Chief Strategy Officer Errol Samuelson in a statement.
“The goal here is to make realtor.com not only the most accurate source of information, but also the most comprehensive. Whether it’s for sale or for rent, (to give) an entire view of the market,” he told Inman News.
Move owns 51 percent of new-construction site New Home Source, and will now be able to offer builders from that site the opportunity to list their properties on realtor.com as well, he said.
The amendments also eliminate a requirement that the listing broker’s consent be obtained in order for the foreclosure status of a listing to be displayed. Realtor.com will now be able to identify properties where notice of default has been recorded, auctions of distressed properties, short sales, foreclosures and bank-owned properties — unless the listing broker objects.
The site will also reinforce the value of using a Realtor when buying, selling or investing in real estate, and will give consumers tools to differentiate between Realtors and non-Realtors, the announcement said.
While not part of the approved amendments, Samuelson said realtor.com would “call out” when a listing belongs to a Realtor and highlight any certifications or designations that Realtor has. In addition, the site will have targeted messages on search result pages and listing pages highlighting Realtors’ advocacy work on behalf of local homeowners, he said.
Move spokeswoman Alison Schwartz said plans to differentiate Realtors will not be shared until formally launched for competitive reasons. She declined to provide further details due to selective disclosure rules from the Securities and Exchange Commission. Move will file a Form 8-K tonight notifying investors of amendments, and it will be available tomorrow morning, she said.
The idea of a chief economist for realtor.com, which sources say Move has advocated in private discussions with NAR, was not discussed at the meeting.
Samuelson said his biggest concern — not only accurate, but comprehensive content on realtor.com — was addressed. “We’re very happy with what happened today,” he said. “It’s a landmark day … for the relationship between our organizations.”
After the meeting, Danny Frank, a NAR director and chairman of the Houston Association of Realtors who has been very vocal about making realtor.com more competitive, said today is a great day for Realtors.
“This day will go down in history as the day Realtors set realtor.com free,” he said.
Move will report its second-quarter earnings on Aug. 1 and plans to discuss further details from the meeting during a call with investors. Ian Corydon, a senior analyst and director of research at investment bank B. Riley & Co., said the amendments were “nice incremental changes, but not game changers.”
“Move has long had the best new construction information out there … and it was a no-brainer to get that information onto realtor.com. Getting rental listings on realtor.com also seems like a no-brainer and vital if Move is to better compete in what is an emerging opportunity that Move, Zillow and Trulia are also chasing. Being the go-to site for rentals also likely means the consumer comes back when they are ready to buy,” Corydon said.
“The ability for consumers to differentiate between Realtors and agents who are not Realtors … may serve a nonexistent need on the part of consumers and is likely a net neutral for Move.”
The 785-member board laid the foundation for today’s decision at NAR’s midyear conference in May when it authorized a closed meeting to consider whether to update the agreement between NAR and realtor.com operator Move Inc. to give realtor.com more freedom to compete with rivals such as Zillow and Trulia.
At the time, the board approved a resolution stating NAR’s leadership team would work with Move and RealSelect to develop recommendations “to enrich and broaden the user experience” on realtor.com and present them to the board at today’s meeting.
Ultimately, RIN’s seven-member board of directors developed the recommendations, which were approved by NAR’s 75-member Executive Committee this morning before the board meeting. The RIN board has the authority to modify the realtor.com operating agreement without NAR board approval, but wanted a “vote of confidence” from the NAR board before doing so, Thomas said. The RIN board approved the changes immediately after the meeting’s conclusion and attorneys are currently in the process of finishing up the agreement, he added.
NAR and Move remained mostly close-mouthed in the runup to the meeting. Due to Move’s status as a public company, NAR directors attending the meeting were asked to sign nondisclosure agreements, and electronic devices were prohibited.
With listings from virtually every multiple listing service in the nation, realtor.com had long held the title of most-visited real estate website, but started slipping in 2010 in rankings maintained by Experian Marketing Services. Last year, Zillow and Trulia outmatched the site, climbing up to No. 1 and No. 2, respectively.
NAR CEO Dale Stinton has previously noted that the content of realtor.com and third-party sites is “wildly different” because the operating agreement between NAR and Move prohibits Move from incorporating content similar to those of third-party sites. The agreement cannot be changed without RIN board approval.
The realtor.com operating agreement dates to 1996 and was last amended in 2010 with the goal of allowing more rapid innovation of the site by streamlining the development and implementation of improvements to realtor.com.
Some details of the amendment were kept confidential, but became clear when Move announced the following year that it would run lead forms for buyer’s agents on realtor.com listing detail pages not unlike those employed by Zillow and Trulia.
The “Connection for co-brokerage” program proved controversial.
Although brokerages can opt out of the program, a month after the change HomeServices of America Inc. subsidiary Edina Realty Inc. announced that it was pulling listings from realtor.com altogether, in part because it objected to the lead forms. (Edina stopped providing listings to realtor.com last year.)
NAR is covering directors’ expenses to attend the meeting.
What do you think? Will the changes to the realtor.com operating agreement approved today by NAR help the site compete with Zillow and Trulia? Leave your comments below.