- Time is running out to comment on proposed changes to an NAR policy that allows Realtor-affiliated MLSs to force all agents in a broker's office to subscribe to the MLS.
Alright, agents and brokers, now’s your chance: If you have an opinion on whether MLSs can require you to pay for their service even if you don’t want it, it’s time to say your piece before it’s too late.
An advisory board of the National Association of Realtors (NAR) is meeting August 28 and 29 in Chicago and will be discussing an NAR MLS policy that allows Realtor-affiliated MLSs to require that all of the licensed salespersons affiliated with a broker’s office subscribe to the MLS — if a broker is a member of the MLS and that broker’s office lies within the territorial jurisdiction of the association that owns and operates the MLS.
Language for changes to the policy, MLS Policy Statement 7.42, has yet to be drafted, but NAR’s MLS Technology and Emerging Issues Advisory Board is looking to craft that language during its meeting in Chicago so that it can be put up for a vote of the trade group’s Multiple Listing Issues and Policies Committee in November. The MLIP Committee makes MLS policy recommendations to NAR’s Executive Committee, which then chooses whether to pass them up to the NAR board of directors for final approval.
Those hoping to influence that language should send their feedback to firstname.lastname@example.org — soon, according to panelists at Inman Connect San Francisco last week.
“The time [to speak up] is coming to a close,” Matt Consalvo, CEO of Arizona Regional MLS (ARMLS) told conference attendees. “Send that email now.”
According to the brokers pushing for change, the policy as-is hurts agent recruiting and retention; forces brokers or their agents to pay for MLS services they do not want or find valuable; and discriminates against newer, tech-enabled business models.
On the other hand, any changes to the policy may have to contend with some MLSs’ worries regarding “free riding” by agents who don’t pay for the MLS as well as impacts on MLS budgets if agents were no longer forced to join the MLS.
The policy changes under consideration are being called “MLS of Choice” at the suggestion of Florida-based broker-owner Jim Weix, who first brought up the issue a year ago. He would like to see the current policy eliminated and replaced with a policy akin to NAR’s Board of Choice policy, adopted in 1994, which allowed Realtors to “choose the board to which they want to belong on the basis of the factors they decide are most important rather than being limited by office location or jurisdictional boundaries” so long as their broker is also a member.
The advisory board seems to be thinking along these lines.
“The new concept would allow agents a choice in subscribing to any MLS in which their broker is a participant, and it would require MLSs to only assess brokers a fee based on their affiliated licensees who chose to subscribe to the MLS. However, MLSs will have the discretion to assess fees to agents affiliated with a participating office jurisdiction, if those agents have not subscribed to another Realtor MLS,” NAR said on its website.
Merri Jo Cowen, CEO of Florida Regional MLS, said she was “in complete support” of such a change, especially with the requirement that an agent must belong to an MLS.
“It’s not an option that an agent belong to no MLS,” she said.
Virtual brokerage eXp Realty also suggested a “waiver approach” in which MLSs would be required to “exempt from fees any licensee affiliated with a participant who, together with the participant, signs a certificate in a form approved by the MLS certifying that the licensee (1) neither has direct or indirect access to the MLS nor uses the MLS and (2) pays fees to another MLS.”
Other MLSs have taken that approach and some in the Connect audience expressed support for the idea.
Oregon broker Rick Harris, chair of the advisory board and panel moderator, brought up objections to changing the policy that some MLS executives had voiced.
“MLSs need to pay the bills,” he said.
MLS data should be properly used and MLSs should be properly compensated for it, but that’s not a reason to avoid making a change, Consalvo said.
“There’s not one way to meet that challenge but lots. [People] are stealing the data today,” he said.
Harris asked, “But aren’t we just going to put some MLSs out of business with this?”
There was silence in the room for a second and then someone in the audience clapped, indicating that perhaps some MLSs shouldn’t survive.
Consalvo then said it wouldn’t “necessarily” push any MLSs to close their doors and might spur some to merge with their neighbors, though he wasn’t “hanging [his] hat on that.”
Sam DeBord — a broker, Inman contributor and member of the MLS advisory board — said that MLS consolidation was “not the intention” of the policy changes, but it is a trend that is happening.
“There may be some growing pains, but that’s business,” he added.
Could there be unintended consequences? Harris asked.
“We won’t know everything that will change. There will be adjustments in the short term,” DeBord said.
Consalvo noted that changes to the policy — and their possible consequences — had been under discussion for more than six months. Besides, he asked: What will be the consequences of doing nothing?
“What we need to do is make it easier for the folks that want to do business with us,” Consalvo said. MLSs should evolve with the market-driven needs of their brokers and subscribers, he added.
MLS of Choice would allow brokers and agents the flexibility to choose the MLS service that would best fit their needs and business models, according to DeBord.
As the policy stands now “it really provides these financial hurdles to the best of the best,” he said. Brokers that want to grow and expand become “victims of their own success.”
As the panel session ended, Harris said, “I’m somewhat concerned that we haven’t had broad enough feedback.” He again asked for input from the audience at email@example.com and later published a blog post on RealtorMag outlining MLS policy changes under consideration.
The advisory board will also consider policy changes regarding what should be done about “coming soon” marketing; developing more flexible education options; increasing the number of years of sold data that must be made available to brokers; and increasing the minimum number of results that surface in response to consumers’ online property searches.
For more on those potential policy amendments, see Harris’s blog post.