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Upstream and RPR: the smart grid to power the real estate machine

Why this new initiative is poised to revolutionize the industry

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The negotiation, dissemination and confirmation of an agreement to build Upstream this past week between brokers and NAR’s board of directors was shocking in its speed. Virtually the entire broker sphere is on board. Upstream, with its newly unified backing, has the potential to alter significantly the power structure of the real estate industry.

To put the agreement in its simplest terms: The brokers representing the vast majority of agents nationwide support Project Upstream. Their goal is to create a broker-controlled gateway to all online display of real estate data with broker-specific rules attached. They’ve partnered with NAR to fund building that gateway with RPR — the largest parcel-centric property repository in the industry — as its database.

Brad Inman wrote this week that brokers are biting back at “the machine” of technology that wrested control away from them decades ago. He wondered if Upstream would be just another middleman.

As I watched the partnership solidify in D.C. this past week, it was almost bizarre to see this new power player emerge during a nonprofit trade organization’s annual legislative meeting. All outward appearances were that this was just another buttoned-down event designed for measured, process-driven political decision-making.

In reality, a group of executives and technology minds were seizing an opportune moment and wresting control of the industry’s conduit to the consumer world online. This new power player, the middleman that he might appear, was Michael Corleone eliminating his stunned opposition while attending a baptism. No one thought him capable of such swift and broad consolidation of power until it was too late.

Brokers and NAR can now create a smart grid to control the flow of power to any vendor, MLS or portal that is dependent upon broker data for viability. This isn’t just “taking our data back.” It won’t just allow brokers to decide where their data goes. It will define how, when and where much of that data is displayed and used at any end point.

As we all know, the real estate industry is hyper-competitive. And because there are few better catalysts for innovation than competition, real estate is constantly blazing new ground. Real estate expansion teams -- teams that do business in multiple markets -- are one of the industry’s latest, and hottest, innovations ...

The real estate tech machine has always been powered by a tangled web of broker data too disjointed to control. It looks like a Brazilian favela, with rogue users strapping their own data lines anywhere they see fit and supplying unreliable power sources to anyone with the willingness to plug in. We know it’s a risk to the end user, but no one has ever built the infrastructure to replace it all in an organized and fully funded way.

That can end with the smart grid dashboard of Upstream.

Brokerages can curate their data-driven content on a granular level if Upstream is built out as a flexible, powerful platform. A brokerage could deliver its full data set to an MLS, restricting the data to co-brokerage and IDX uses. Controlling its own syndication dashboard through Upstream, it could decide it only wants Portal A to receive five photos of each listing and require a linkback beside each to the broker’s website (driving direct contacts from consumers). Other portals, vendors and partners might be required to follow a different set of display guidelines based on their relationship with the broker. Each broker could form its own set of rules for each of its data recipients.

Broker experimentation with subsets of data and rules, displayed on different advertising outlets, will allow us to develop long-term analytics showing what kind of marketing actually sells homes. No longer reliant upon the vendor’s statistics, brokers will be able to develop rational models for marketing that are based on sales instead of impressions.

Upstream is a gift to relations between brokers and MLSs. It takes away the MLS’ need to syndicate, and it takes away the broker’s ability to protest. The MLS continues to provide the cooperation and compensation rules at the broker-to-broker level, while brokers are free to experiment with their consumer-direct advertising as they see fit. RPR has always had a noncompete with MLSs, so there’s no national MLS controversy.

It’s a massive coup for NAR. Brokers could have built Upstream on their own, but interbrokerage rivalries would have slowed the process significantly. Recognizing this as an industrywide watershed moment, they tabled their past disputes and added a unifying voice to lead it (and to fund it significantly). RPR was a financial drag in the past, but it looks like a product that was built to do exactly this. Pivot or not, it’s an ideal partner to jump-start the initiative.

When it all shakes out, access to more standardized, reliable data will be available to anyone willing to play by the rules. That might inhibit a few tech companies’ plans, but it’s a much-needed maturation for the industry’s data foundation.

Real estate’s utmost service value is to the transactional parties, not hobbyists or entertainment browsers. The people directly responsible for helping sellers sell and buyers buy could once again be sitting at the control panel that powers sales-related real estate data across the Web. That’s a good thing for our industry.

Sam DeBord is managing broker of Seattle Homes Group with Coldwell Banker Danforth and a director for Washington Realtors and Seattle King County Realtors. You can find his team at SeattleHome.com and SeattleCondo.com.

Email Sam DeBord.