If you ask an MLS exec what an MLS is, he or she will likely answer that it’s an organization dedicated to providing real estate broker participants with a platform to share listing data and facilitate the offer of cooperation and compensation. That’s not wrong. It’s a definition that the NAR and the Council of MLSs agree on. The problem is that this definition doesn’t even begin to describe what it means to be an MLS. Not even close.
If you ask an MLS exec what an MLS is, he or she will likely answer that it’s an organization dedicated to providing real estate broker participants with a platform to share listing data and facilitate the offer of cooperation and compensation. That’s not wrong. It’s a definition that the NAR and the Council of MLSs agree on.
The problem is that this definition doesn’t even begin to describe what it means to be an MLS. Not even close.
MLSs today are so disparate that they are almost unrecognizable as being of the same species. They range in size from fewer than 100 subscribers to more than 80,000. Some are separately and wholly owned by associations of Realtors, some by brokers.
Some have representative governance, and some do not. Some are specifically designed to run as close to break-even as possible, some are powerful money makers. Some facilitate data access to brokers, some inhibit it. Some offer a suite of products and services to enhance subscriber productivity, and some provide only the basic MLS service.
The fact that all MLSs facilitate the offer of cooperation and compensation is such a minimal piece of the whole that it’s like using “does it have four legs?” as the descriptor of what it means to be a dog. Yes, all dogs have four legs, but not all animals with four legs are dogs — and having four legs doesn’t even scratch the surface of what dogs mean to our lives.
The MLS industry is in an existential crisis because there is no common understanding of the minimum standards of performance; no agreed upon definition of what it means to be an MLS. And depending on which MLS you subscribe to, you may have a completely different experience of what the MLS means to your business life.
The one definition we all agree on is nowhere near good enough to help differentiate between high-performing and low-performing MLSs. So, when the Realty Alliance says that MLSs need to clean up their act, what it mean sis that some (or many) of the MLSs it participates in don’t perform at a basic level necessary to conduct business efficiently.
Lacking a real, useful definition of minimum performance standards, the Realty Alliance (and others) lump all MLSs into the same basket. To add insult to injury, brokers cannot simply choose to participate in a higher-performing MLS because the listings they need to do business are not available in any MLS except the one that covers their territory.
Organized real estate has given brokers no means, no language and no benchmarks to define the difference between a “good” or “bad” MLS. And while the Council of MLSs has noticed this lack and made some headway with its “best practices,” it lacks the teeth necessary to address under-performance.
Let’s set minimum guidelines of what it means to be a ‘good’ MLS
There is plenty of precedent for minimum standards — after all, it’s something we benefit from on a daily basis. A prime example from our not-too-distant past is the story of Standard Oil.
Back when homes were lit by kerosene lanterns, there were no quality standards for the kerosene used in the lanterns. As a result, impurities in the kerosene would cause some lamps to explode without warning, showering anyone and anything around with flaming oil.
This was not ideal, to say the least, but the U.S. government had yet to see the wisdom of protecting consumers with safety standards. Standard Oil made a name for itself by standardizing its kerosene refining process and marketing a kerosene that could be relied upon not to randomly explode.
Faced with the question of whether to buy kerosene from Standard and the possibility of dying in flaming agony from another brand, Standard Oil quickly became the benchmark product.
Pretty good marketing pitch, right?
Think of the standards that surround you today. If you get rear-ended in a minor traffic accident, your car won’t burst into flames (unless you’re still driving that Pacer or Pinto). When you go to plug in your iPhone, the wall plug is grounded so you don’t suddenly become the conduit to the electricity grid.
When you fly, there are safety standards keeping the plane in the air and the passengers from being turned into oxygen deprived popsicles at 30,000 feet.
Admittedly, the examples I’ve used are safety standards rather than performance standards, but they are to make the point that we benefit from standards. Every single day.
What might minimum performance standards for an MLS look like?
I’ll take a stab at it. These are my recommendations for a good place to begin the conversation. I’ve included my reasoning on any that may not be clear. It’s my sincere hope that this is a starting point for discussions to standardize the services (not just the data) of an MLS.
10 minimum standards of the modern MLS
1. Provides participant brokers with a complete ‘broker download’ of the MLS database for use in broker back-end products.
A broker download is the ability for any participant broker of the service to receive a complete data set of the entire MLS for explicit use in back-end, non-public products.
Use restrictions on the download include no third-party use, non-transferable to another MLS, etc. Small, medium or large — every broker deserves the right to have the MLS data provided in way that he or she can use to support his or her back-end office products.
This is not a VOW feed, it’s not for publication, and it includes all fields available in the MLS for search by a broker.
2. Facilitates the ability for participant brokers to syndicate their company’s listings within the primary MLS to at least the top 5 real estate websites in their market.
Indication of which sites are to be syndicated to must clearly shown on the listing input screen and should indicate whether the broker has chosen to have the MLS send listings, not send listings, or if the broker has a direct feed agreement with the portal.
Broker’s default selection for syndication for their office listings may only be overridden by an agent to turn a broker’s default “yes” to syndication to a “no” if the seller has requested that the listing not be syndicated.
This is necessary because bad data online hurts consumers — period. Consumers don’t blame bad or stale data on the website they happen to be visiting, they blame it on the broker and agent because they think there’s been a “bait-and-switch.”
Clearly, bad data has not hurt the biggest portals with consumers — and the accuracy gap is narrowing quickly.
Because of fragmented data between overlapping MLSs that don’t share data with each other, consumers can already get a more complete market picture by going to realtor.com or Zillow than brokers and agents can from their MLS.
This is problematic for the continued relevance of brokers and agents.
I specifically stressed that syndication selection should be in the primary MLS system and within the listing input selection screen.
From hard experience, it is clear that the majority of MLS subscribers simply will not visit an external syndication service more than once during setup — and many not even once.
Allowing these services to run on autopilot is a disservice to the subscribers (agents) who are often left unaware of syndication choices their participants (brokers) have made.
3. Provides technical support on Saturday and Sunday.
Brokers and agents work on the weekend. The MLS should want to ensure technical problems do not inhibit a broker’s or agent’s ability to serve clients.
Despite low call volume on weekends, being available when you are needed is the foundation of good customer service.
4. Provides state-wide tax data (except in states where state law may prohibit this).
Every real estate license has the state that the licensee is authorized to practice printed on it. Not having statewide tax data for brokers is like withholding case law from different parts of the state from attorneys.
5. Provides professional training support for MLS products and services.
Volunteer trainers are great, and some MLSs are lucky enough to have individuals who are both willing and fluent in technology and MLS services, but, by definition, volunteers have other lives to lead.
If the MLS is going to stay relevant to subscribers, it should be looking to improve the business knowledge of its subscribers by providing superb training by professionals — directly in the brokerage office, if possible.
6. Provides a system-wide electronic showing service.
Just as more comprehensive MLS data improves the ability of brokers and agents to serve their clients, a system-wide electronic showing service improves the ability of agents to serve their client both more quickly and outside of office hours.
When set so that showing alerts populate directly in the MLS system and when the default is for all brokerages to participate, a system-wide showing service provides consumers with modern, expected capability to the showing process.
7. Guarantees 24 hours to either grant or deny a data-feed requests.
This is the computer age. We should join it. Automation is in reach if we apply some effort.
8. Represents at CMLS conferences and NAR meetings.
In any two-year period, the MLS executive should attend one of two annual CMLS Conferences and two of four annual NAR meetings (NAR Mid-Year and Annual Meeting — specifically the MLS Issues and Policies Committee and MLS Executives meetings).
Educating the CEO to the highest possible standard should be the goal of every single board of directors. If the CEO doesn’t learn new things, the board won’t learn new things; the result is an echo-chamber where the only things discussed and approved will be those things everyone already understands.
There are certainly other great conferences that add to the professional development of the CEO and staff, (Clareity MLS Executives, RESO, T-3, etc.), I’m just outlining the minimum.
9. Holds an annual meeting with minimum 30 days notice to broker participants and subscribers. Provides an annual performance report, and allows for public comment.
MLSs should be looking to create good, consistent feedback loops with their participants and subscribers.
Make a point of having the meeting somewhere nice so people will attend, but make it a business meeting and provide financials, annual performance versus goals, future goals and a technology/visioning segment by the CEO or outside professional.
10. Conducts, at least, bi-annual membership surveys, and sends automated surveys after every customer service interaction.
The MLS is a business, but sometimes one that treats its subscribers like a captive audience. Find out what your users want from you, how well your staff does in answering their questions, etc.
Surveying can be scary for execs because it’s often the angriest people who are most motivated to respond to a survey — and poor scores on a survey can reflect on the CEO.
You will want to do it regularly and after each customer service interaction to ensure that you receive a balanced survey result over time.
I am positive that there are more additions, and I am equally positive that there will be many different opinions on whether these are good ideas. The point is — it’s a place to start the conversation.