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For decades, the multiple listing service has been defined as a vehicle for the cooperation and compensation of real estate brokers: If you’ll show me your listings and pay me if I bring a buyer, I’ll do the same.
But that commission structure has come under ever-increasing attack from antitrust enforcement agencies and private litigation in the last few years. With that specter looming, the Council of Multiple Listing Services kicked off its annual conference Thursday with a vision of the MLS that does not depend on commission sharing: as a property-centric “source for all real estate data all the time.” The trade group has more than 200 member MLSs.
In a session called “State of MLS,” CMLS CEO Denee Evans noted that MLSs are dealing with “a lot of uncertainty,” but one thing will stay the same: People will still need houses to rent, buy and invest in.
Speaking on stage in Indianapolis, she laid out a vision of the MLS in the next three to five years as a new, “property-centric” marketplace.
“The future marketplace is about more than just the transaction, more than just a point in time,” she told the event’s some 1,000 attendees.
“I believe it can be the source for all real estate data all the time. … One that incentivizes quality [and] quantity over fines. One where maybe you get paid to play versus paying to play. A database that encompasses all residential real estate information [for] buyers, sellers, renters and investors.”
Evans portrayed the future MLS as not just a listing database, but a “real estate asset database” that focuses on the lifecycle of a property and tracks, collects, cleans, curates and distributes real estate data from different sources.
“This will require us to consider different data that we use and work with today,” Evans said. “This may also cause us to reconsider how we get the data, who can use it and who benefits from it. The data we collect will need to grow … over time. Smart home [data], climate data, cost of ownership, maintenance improvements, mortgage, and a lot of things we haven’t thought of yet.”
In a session called “Lead Is a Verb,” Art Carter, CEO of the largest MLS in the nation, California Regional MLS, said what keeps him up at night is the relationship of the MLS with its brokers, especially if compensation is no longer foundational to the MLS.
“If compensation is taken out [as] one of the foundational issues [of the MLS], it leaves us with cooperation, and cooperation has been under fire in every one of our markets because of the speed in which properties are turning,” Carter said.
“Too many brokers and agents don’t see the community as something that they need to engage with in order to sell property.
“So cooperation, which is going to be our foundational item going forward — I do have a belief of that — is something that we’ve got to double down on in the industry.”
The MLS could potentially serve as a neutral third party that facilitates the sharing of data, according to Carter.
“That cooperation doesn’t just extend to listings,” he said. “That cooperation has to extend to other areas that brokerages that in the aggregate can control the data and be able to give each other insight as to what’s going on in the marketplace.”
CRMLS is focusing on moving away from just listing data toward a property-central model, according to Carter.
“We will collect everything,” he said. “Anything about a property that can be appended to the record and safely shared with the brokerage and agent community, we plan on doing. Anything and everything that can inform a broker so the broker can stay connected with their consumer, we’re going to be putting into a database and sharing out to our members.”
In a session called “Crossroads,” Zillow’s Chief Industry Development Officer Errol Samuelson laid out a similar vision of the MLS as the ultimate real estate data source.
“Let’s make the MLS the single place where every single housing option on the market is available in one database,” he said, noting that certain categories of properties currently do not appear in most MLSs including new construction, rentals, homes for sale by owner (FSBO) and auctions.
“Let’s make the MLS software work the same way that consumer software works everyday in their homes. We can do better. Let’s make the MLS the software platform that can spur innovation. To do that we need standards, but we also need better rules.”
He pointed out that every MLS has slightly different rules, which limits innovation and reiterated Zillow’s stance against the National Association of Realtors’ no-commingling rule, which he said was bad for buyers, brokers and sellers.
He told attendees that they should bring on outside experts on their boards of directors and also that they should charge more — hundreds of dollars per user per month — in order to invest in new technology, such as computer vision, voice interfaces and new ways to search their databases.
“I think if MLS went away, the market would fall apart,” Samuelson said. “So I think there is great, great value that you are offering and I think it would be just fine to charge more and therefore be able to invest more. Just my point of view. None of my business.”