- Credit unions are buying brokerages and bundling services.
- Zillow isn't a broker but its toes are deeper in the transaction.
- Alexa's going to serve you listings.
- Upstream's pragmatic pivot is causing a stir.
- Your choice of MLS may be growing in the future.
NAR’s midyear meetings took place in Washington, D.C., last week. I was just finishing up a recap when two other big stories dropped.
Credit unions are buying up brokerages
Banks are prohibited from opening real estate brokerages. Credit unions, on the other hand, are not. Steve Murray of Real Trends says credit unions are rapidly purchasing brokerages and bundling services.
“Buy from us. Borrow from us. We’ll rebate 20 percent of the commission to you, and we’ll give you 20 basis points off your mortgage’s interest rate. Oh, and we’ll also make your agent whole on the rebate.”
To me, that’s the biggest news of the week. On to that other story you may have heard about:
Zillow’s pitch to agents: We’ll facilitate direct purchase offers from our identified investors/venture capital firms/flippers to potential sellers. We’ll let you deliver a CMA to the same folks.
C’est la vie; it’s a business decision. Consumers are given options to work with agents, but some agent-free transactions will occur via Zillow initiation. Offers and transactions are managed in Zillow’s transaction management software.
Zillow’s not technically becoming a broker with this move, but it’s taking on every activity it can that doesn’t require a license — smart. Some agents are screaming. Some are yawning. Let’s just not pretend that initiating a purchase offer for a buyer, providing the forms for the contract, and directing the services upon which it will be transacted isn’t a big shift.
Some agents will love the seller leads. Some are just fed up with the long-running tap dance act of Zillow’s messaging to the industry. Brian Boero distilled it perfectly.
In the latest scene, we’re told, “It’s just a test.” This is apparently supposed to educate us that transactions happening in the real world are none of our concern until the “test” label is removed by the marketing department.
Of course it’s a test, one that management approved, to see if it’s worth expanding nationwide and monetizing. Just tell us, “Shareholders want profits so we’re looking for new revenue streams, and dipping our toes a little further into the transaction looks like a good direction.” We already know.
The Opendoor in the room
Opendoor is the Instant Offers precursor you’re probably most familiar with. While it was reported on Inman that I “chided” Opendoor previously, I’ll note that I commended Opendoor’s leaders and technology. I merely chided the media fawning over a supposed huge new value to consumers.
Flippers are not new, they’re just better financed with better tools, and now they’re getting better access to sellers.
Opendoor’s folks are genius, just as are Moneytree’s founders. They’re doing transactions with massive short-term fees and significant time savings, and putting their services in front of people who may want them. My opinion that these transactions make financial sense for a scarce few doesn’t preclude the businesses from selling them to whoever will buy them.
Alexa’s hawking listings
Back to NAR midyear: voice activated systems (like Amazon’s Alexa and Google Home) became officially approved technologies for brokers to use for delivery of IDX listing data.
While there was some concern about the ramifications, brokers are already using this technology in the field. We want to ensure that the spirit of IDX cooperation and attribution continues, but not hold back innovative brokers.
Will this tech become popular? Spencer Rascoff said at the T3 Summit that he didn’t think it would be a big deal in real estate search. It’s difficult to say, but imagine what it could do to help folks with visual disabilities interact with brokers and agents.
The technology will change by the day. So maybe Rascoff’s right, or maybe brokers have an opportunity. He does have a lot of other things on his plate.
Upstream had two big stories last week. First, more NAR funding was approved for RPR to build out the project. Second, instead of only allowing broker/agent listing input at Upstream’s interface, it will now accept a broker’s feed of listing data from the MLS itself.
Spending a week with much of the industry in one place reminds you how much you don’t know. The politics surrounding this initiative are staggering. There are plenty of folks proclaiming Upstream’s “pivot” as a sign of failure.
It’s a pragmatic swallowing of pride. Many insiders will tell you that the divide created by the unfortunate tone of UpstreamRE’s ancestors’ original messaging to the MLS community made this move a necessity. It’s also a big shift from the ideologically pure original intent.
At the same time, it removes the most significant hurdle to access for nearly every broker/agent in the country. There’s no retraining on listing input. You want Upstream? You got it.
The Upstream direct input (which is necessary in its system to solve multi-MLS overlap) requires technical development at the MLS level to accept the listings.
If multi-market brokers like what they see in the Upstream hybrid input product, they may eventually work with their MLSs and vendors to employ the single input solution. In the meantime, vendors may proactively develop software updates that provide faster Upstream implementation options on the most common MLS software platforms.
RPR in the mirror
It seems that someone whispers “National MLS” nearly every time RPR (Realtors Property Resource) is mentioned. If you’ve done the committee circuit for a few years, you know the routine.
Competitors have reason to keep looking over their shoulders, but this particular fear is tiresome. It’s as if we’re in the horror flick where the victims chant, “Candyman…Candyman…Candyman…” into the mirror to summon the Bogeyman.
Only in this version, the bogeyman RPR comes crashing through the mirror to take our cooperation and compensation agreements if we don’t keep whispering “National MLS…National MLS…National MLS…” to keep it at bay.
RPR has contractually agreed to never become an MLS. MLSs have been consuming each other at the rate of around one every four days. 100 have disappeared in one year. How many has RPR replaced?
‘Coming soon’ listings
MLSs across the country are trying to develop “coming soon” statuses. It seems like a solution for a problem that doesn’t exist, but agents want another marketing angle. So MLSs are obliging.
Currently, any MLS could accept an active listing, allow for a restriction on showings for two weeks while the seller fixes things up (with a seller’s signed consent), and create the “coming soon” buzz without adding a new status for MLSs and standards developers to deploy.
If a new status is the hoop everyone wants us to jump through, though, we’ll probably do it. So let’s define it.
If the property is shown, it’s not “coming soon,” it’s active. If it starts as “coming soon,” then goes active, and one minute later goes pending, it probably wasn’t ever “coming soon.” It was active.
We can do “coming soon,” but only if we’re going to be honest about it — not to promote double-sides, in-house sales or preferred buyers.
Politics at midyear
There’s a lot of talk about tax reform. As we hit the hill in D.C., our message was as clear as ever. No matter the tax policy coming forward, it should incentivize investment in homeownership, much like we incentivize investment in health care, retirement and education. That’s a tough message in a D.C. atmosphere that’s very loud, but we’re still carrying it.
Some members want us out of politics, but today’s reality is that if you’re not at the table, you’re on the menu. We’ll be at the table for our industry.
Can the Voice for Real Estate come through a revolving door?
I’m a local association president. Our board’s CEO relays media calls and interviews to me. I appreciate the deference and the recognition it creates, but I can see how it weakens the continuity of our voice as an organization. The tradeoff is difficult to swallow.
At NAR, we hoist a new name up for the media once per year and hope that it sticks. This is our tradition, and it’s a great gift to our presidents, but it’s probably time to take a hard look this practice’s effect.
Our voice needs to recognizable to stay on top. Our new CEO, or someone she/he hires, needs to be consistently in front of the media.
Is the board too big?
Most dare not even whisper these words, as a position on the board of directors is a sacred cow, not to be touched. NAR has about 900 directors on its board. What’s the ideal size of the board? Maybe it’s exactly what it is today, but it shouldn’t be heresy to ask.
Our volunteer members do amazing work supporting leadership from the committee levels. Can we have a real, effective debate at our current board of directors’ meetings with our current size?
Our data divisions make us vulnerable
Realtor members have less than ideal access to our data. Between NAR data, nationwide MLS data and RPR data, we have the opportunity to meld these resources into an incomparable asset for use by our membership. Yet we let it sit in artificial silos to protect our territories.
Meanwhile, innovative data companies create tools to aggregate and repurpose such data while we sit on our hands and watch or, better yet, cut them a check to buy it back.
There’s a lot of distrust within our organization. While there are many reasons for it, they make us weak relative to outside forces.
Multi-generational Realtors are often the most devoted and knowledgeable leaders. I’m continually impressed when I travel to events at the percentage of committed volunteers who are second, third or even fourth-generation Realtors.
Our incoming president, Elizabeth Mendenhall, is a sixth generation Realtor. There’s no replacing that institutional knowledge. Kudos to those of you who carry that torch.
I’ll introduce this topic with the moniker it has taken on in the media, but this issue’s logistics are significantly different than Board of Choice. Yet, its intent is similar: to serve broker and agent members with a better, more flexible service model. Giving brokers and agents more choices in the MLS services they pay for is the path forward.
We’re looking into ways to incentivize brokers to grow and join MLSs without cost prohibitive policies holding them back.
The issue is complex and I won’t attempt to define all of the parameters here. Just know that we’re working with all of the stakeholders — MLSs, brokers, agents, associations — and trying to find a policy solution that positions all groups to be prepared to thrive in a changing marketplace.
You can contact us with your stories, concerns, and suggestions at email@example.com. We’d love your feedback.