After six years and $62 million, the trade group says it will reallocate funds to “other important member-facing initiatives.”

After six years and $62 million, the National Association of Realtors will no longer offer online transaction management software as a free member benefit for its nearly 1.5 million members starting in 2022.

ZipLogix, acquired by Lone Wolf in 2019, has been the chosen transaction management provider for the trade group since November 2015, when the NAR board of directors approved a deal to provide all of its members with zipLogix’s zipForm Plus software at no additional cost.

At the time, then-NAR CEO Dale Stinton said NAR was prepared to fund the zipLogix offering “in perpetuity” from NAR’s reserves.

Starting in first-quarter 2016, Realtor agents and brokers got free access to the firm’s zipForm Plus software, transaction forms specific to their area, document storage through zipVault, and zipLogix’ transaction management system, zipTMS (previously known as relay).

The deal did not include the broker version of zipForm Plus, zipForm Mobile, zipFormMLSConnect, e-signatures from zipLogix Digital Ink or any other products zipLogix launched thereafter, such as zipCRM.

The deal has cost the trade group about $62.3 million since and its continued subsidization was one of the reasons the trade group gave for raising its annual dues in 2019.

The dues increase incited controversy and dissent, in part because many state and local associations do not use zipForms and provide their members with competing transaction management products such as those from dotloop, Instanet (also owned by Lone Wolf) and Florida Realtors-owned Form Simplicity and therefore, their members received no benefit from NAR continuing to pay for zipForms.

After re-upping once, NAR’s contract with zipLogix was set to expire at the end of 2020, but was extended for a year to the end of 2021 at the time of the Lone Wolf acquisition. At that time, NAR said, “When the agreement expires, we will have the option to renegotiate it or seek other software options that serve your needs.”

After NAR allocated zero dollars to the member benefit in 2022 and beyond in its latest budget, Inman asked for an update.

“The NAR Leadership Team recommended eliminating future subsidization of the program and reallocation of the associated funds to other important member-facing initiatives,” Mantill Williams, NAR’s vice president of communications, told Inman via email Tuesday.

“Based on their recommendation, the current agreement with zipLogix will continue through the end of 2021. NAR Members will recall that the Leadership Team has pledged to routinely take a look at the organization to find the best efficiencies to meet the needs of Realtors.

“Originally, the intention was to conclude the program at the end of its current term, which had been scheduled for the end of 2020. However, the NAR Leadership team is very aware of the dynamics involved in unwinding this program. As a courtesy to state and local Associations, the Leadership Team has recommended funding the program for an additional year, through the end of 2021.

“The goal is to provide Associations, who are currently participating in the Program by licensing their forms to zipLogix, sufficient time for budget planning and to make their own arrangements with a software provider for delivery of forms to their membership in 2022 and beyond, should they choose to do so.”

NAR first made zipLogix software a member benefit in the wake of Zillow’s acquisition of rival transaction management software firm dotloop. At the time and again when NAR proposed its dues increase in 2018, NAR said providing the software was part of its efforts to keep Realtors at the center of the transaction, lead them into the future and help them stand out from other licensees.

NAR declined to comment on whether the zipLogix member benefit had accomplished its intended aims, whether the aims had changed or whether NAR determined there were other ways to accomplish them.

NAR funding for zipLogix member benefit per year
2016 $11.9 million
2017 $12.6 million
2018 $13.5 million
2019 $8.4 million
2020 $8.4 million
2021 $7.5 million
Total  $62.3 million

Source: NAR

NAR also declined to comment on how it will use the millions that will no longer annually go toward the zipLogix member benefit, on what changed in the six years since Stinton said the trade group would fund the benefit in perpetuity, and on whether the decision had anything to do with zipLogix’ acquisition by Lone Wolf.

Founded in 1991, zipLogix was a joint venture between NAR and California Association of Realtors subsidiary Real Estate Business Services Inc. (REBS) before Lone Wolf bought the company. In 2018, REBS owned 57.4 percent of zipLogix and NAR owned 30.2 percent. ZipLogix itself held 11.6 percent ownership (not owned by any Realtor association or subsidiary) and several other state and local Realtor associations held the remaining 0.8 percent interest at the time.

Also in 2018, zipLogix rivals Zillow Group, Instanet and Form Simplicity told Inman NAR had never given other transaction management firms a chance to compete for its business through price or any other means, even as the trade group asserted it had “turned over every rock” to save members money before asking for a dues increase.

“We had several discussions with NAR over the past year to extend this offering,” Lone Wolf spokesperson Lauren Dennard told Inman via email Tuesday.

“While we respect NAR’s decision, we will continue to work with them, as well as state and local [associations of Realtors] across the country, to ensure agents do not lose valuable transaction history and data from this solution that is critical to their business.”

Both Lone Wolf and NAR declined to comment on the sticking points in the negotiations.

Before NAR made zipLogix software a member benefit in 2015, about 500,000 Realtors already used the software. NAR hoped to add 100,000 to that figure by making it a member benefit. Currently, more than 600,000 agents use the software, of which “very few” are non-Realtors, according to Lone Wolf.

Lone Wolf expects the expiration of the national member benefit will have “minimal impact on agents in the U.S.”

“Though the solution is not included in NAR’s budget, Lone Wolf has been working hand-in-hand with associations and [multiple listing services] across the country to ensure as many agents as possible keep the solution they use and trust every day, while also offsetting any direct costs to agent,” Dennard said.

“For example, both the California Association of Realtors (C.A.R.) and Texas Realtors will continue to provide Transactions [formerly known as zipForm and zipTMS] as a member benefit to their +200,000 and +140,000 members, respectively. At the moment, as a result of continuing our long-standing partnerships with associations across the country, over 500,000 agents and counting will continue to receive the solution in 2022 and beyond.”

Lone Wolf has made a “multi-million-dollar investment” in Transactions “to provide the best security, stability, and innovation in the market today,” according to Dennard.

This includes integrating the platform with dozens of leading digital tools and services in the past year, including the ability to order title insurance directly through the platform — a first in real estate, the company said — and an integration with another product Lone Wolf recently acquired, Cloud CMA.

“Future innovations include a revolutionary transformation of digital forms, starting in 2021, as well new in-house connections to digital marketing and CRM through newly-acquired companies, HomeSpotter and LionDesk,” Dennard said.

Meanwhile, Realtor-owned Form Simplicity this week announced it is now providing services to members of Missouri Realtors, Georgia Realtors, and Alabama Realtors, and subscribers of Oregon Real Estate Forms, which is owned by the Eugene Association of Realtors and the Portland Metropolitan Association of Realtors.

This means nearly 100,000 Realtor members in those states will have access to digital forms when purchasing the Professional Edition or Ultimate Edition of Form Simplicity, the company said.

Asked whether these associations also offered access to zipLogix and would continue to do so and whether Form Simplicity will benefit from NAR’s decision to end its transaction forms member benefit, Florida Realtors declined to comment.

“I can say that none of the states we just added mentioned that the NAR/Zip relationship was part of their decision-making process to sign a license agreement with Form Simplicity,” Tricia Stamper, Florida Realtors’ director of technology products, told Inman via email.

Editor’s note: This story has been updated with a comment from Florida Realtors.

Email Andrea V. Brambila.

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Dotloop | NAR | technology | Zillow
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