Steve Murray closed out the first morning with research and observations from talking to many brokers. He had some very insightful comments and some obvious comments. In the obvious column is the observation that the Internet has taken away the ability for Realtors to be the gatekeepers of the data.
Brokers and Agents now say, that almost without exception, clients come to them with a list of homes to see. Buyer’s agency used to be a joke but are now needed to guarantee compensation because of the Internet.Brokers are also reporting experiencing “Technology Exhaustion” as they are overwhelmed with Internet/tech companies calling on them. They are having a tough time sorting truth from fiction.
NAR is reporting homes sales only declining 1% in the last quarter. Brokers are not saying the same thing. Many are experiencing drops of 10% to 20%. Alex, CEO of Cendant said same thing, It is funny to me that it seems that most Brokers and consultants are questioning the validity of NAR’s results rather then trying to find out where the sales have gone. In a slowing market, traditionally the discount brokers suffer as there is a flight to “quality”. Maybe something different is happening this time around. We will have to keep an eye on that.
Industry is reporting increased channel confusion due to the web.
Again, in the obvious column but important to not is the relentless compression of margins in real estate and all the industries around real estate (mortgage, insurance, title, appraisal etc.)
In the afternoon I thought I would attend the “Changing Nature of the MLS” session. It had David Charron, MRSI, Inc., Chris Eigel, Koenig & Strey GMAC Realty, Bryan Foreman, First American MLS Solutions, Inc., and Scott Tobias, Watson Realty, ERA. I was hoping to discover something about the “changing” aspect of the talk’s title. Instead I heard some fear and defiance. Charron tacitly acknowledged that MLSs are scared of the new models. He feels that they are going after the MLS’s greatest point of weakness – the consumer and ultimately referrals (which he acknowledged as the “white elephant in the room”. He is scared that consumers value competence over personality. Wow shocker! NOT! I don’t care how difficult a Realtor is if he can get me an extra 10 grand I will put up with it. He did recognized that the content is valuable and that Brokers own it. Still, nobody on the panel will acknowledge that consumers are going to DRIVE the transaction and that they will DEMAND that their listings are advertised everywhere, I wanted to stand up and ask them, if their son or daughter were selling a house would you still talk about them (the seller) in the same way? Everything you would do for them you should do for all your other customers.
Charron also pointed out that 20% of agents had NO sides in a transaction last year, and cracked that everyone wants to have the public to have access to the MLS – well we already have that. So goes the thinking …
Charron also says that Realtors have to reaffirm their co-operation model (IMO a grab for more power for the MLS) on threat that if they don’t band together the moto will become “list for free and sell for three”.
He left us with four possible futures for the MLS:
- Change to meet brokers needs and continue on as is
- Large firms pull out – leading to chaos –
- MLS Regulated to a utility by DOJ (this will be in his opinion the end of the industry)-
- Or Just wait …. (and who knows what).
Chris the broker feels that MLS had always been a given but not anymore.Chris basically postulated that the MLS should be:-
- A centralized data source-
- Professional organization ensuring co-operative guidelines, ethics, rules are followed-
- Maybe some transaction management-
- Should be regional in size. Not to big not too small
And what the MLS should not be
- A Brand (as FSBO’s should not be b./c it empowers them)-
- Not competition for the broker ( no public site ) or any public services
- Not in between Agent and Broker in any way
- No services-
- No Public adverting at allHe believes (and I think he is right) that all organizations want to be bigger and tend to try and grow.Foreman
from 1st American MLS was the most misguided (sorry Brian). He feels that brokers are giving away their business. The one thing he is correct on is this: that brokers have been abdicating their responsibility. MLSs have been run by partime agents, agents that couldn’t cut and brand new agents. Yet these agents make the hugely important choices that profoundly affect brokers. This could very well be true.
Foreman then went on to say that his company has built for these MLS’s many misguided, expensive and costly “features” that MLS’s ask for, this even though “He knows that they are horrible ideas”. Wow. Foreman feels that the data should be totally restricted to brokers and hidden from the public and doled out like treasures. He has probably the most restrictive ideas I have heard so far.
Scott Tobias from Watson told a story about starting his own MLS to try and ensure a higher quality standard of service was adhered to. Agents in his MLS inBakersfield were fined, as they should be , for infractions. He had to fold his MLS as other brokers were joining both and it started to hurt his agents. This just points out the weakness of current mls structures. All members are forced to co-operate and associate with other members even if they don’t agree with their level of service or even ethics and are therefore tarred with the same brush.
Day one complete – more to come for day two