Thursday
November 27, 2014

Too Many MLSs?

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Too Many MLSs?

Data standardization remains a challenge across various listing platforms, causing some to call for MLS consolidation.

The strain between brokers and agents was evident when the subject of the number of MLSs across the country was discussed at the MLS Forum at the 2013 REALTORS® Conference & Expo last November.

Sales associates are frustrated because they have to pay membership fees to more than one organization, and brokers often have difficulty coordinating data between disparate sources. Some brokers at the forum said they have members of two different associations in the same real estate office or listings that are directly across the street from each other appearing in two separate MLSs.

More on the listing data debate

This piece is part of a larger package on listing data. Additionally, you can read about why some are concerned about where agents choose to market themselves. And everyone should know what kinds of questions to ask before sharing data.

Even when MLSs are willing to share all of their data, brokers complain that it’s difficult to get pieces of information to match up across different platforms. While NAR has been working to promote data standardization in the industry for years, the hundreds of MLSs across the country use a wide variety of tools to get their members’ listings in front of consumers, from proprietary software to offerings from companies with names such as Rappatoni, Goomzee, Solid Earth, and Systems Engineering.

In 1999, NAR and six vendors created Real Estate Transaction Standards (RETS) to provide a vendor-neutral approach to data sharing. Though NAR’s handbook on MLS policy states that MLSs have had to comply with these standards since 2009, brokers still report major differences in the ways each MLS displays the same type of listing data. Then in 2012, NAR partnered with the MLS and vendor communities to form the Real Estate Standards Organization (RESO) to govern RETS and other industry standards publication. Later that year, RESO published the first draft of its “data dictionary” to further clarify and standardize the way agents describe a property and transaction. Last year, RESO published an updated dictionary, as well as an application programming interface (API) document for public commentary. The aim of such documents is to make the data stream usable for app developers and technology vendors in a more “plug-and-play” fashion. But another goal of RESO’s efforts is to eliminate the problems brokers are having with integrating multiple MLS feeds.

Some say a way around these problems in the interim would be consolidating smaller MLSs into larger regions or even statewide MLSs. “It currently costs us a lot of extra money to blend [listing data] together,” Barnett told MLS forum attendees in November. “It would be nice to have one feed and one large regional MLS.”

But there are challenges to the large MLS model as well. In 2011, the Arizona Board of REALTORS® considered moving to a statewide MLS. Duane Fouts, e-PRO, managing broker at West USA Realty in Phoenix, was the president of the state association at the time. He and a task force dedicated to studying the issue traveled the state, talking to members about the idea of going statewide. After the task force recommended the change, they got more than 70 percent preliminary approval for the state board to purchase the largest MLS, the Arizona Regional Multiple Listing Service (ARMLS), and roll the smaller MLSs up into that.

But then it all “went down in flames,” Fouts says. At the time, the four MLSs that are shareholders of ARMLS had the unilateral right to veto any changes, and one of them exercised this right. Fouts says the main objection from individual members was the idea of brokers and agents “acting outside your area of expertise,” working leads in markets where they don’t have local knowledge.

“Members were fearful of the metropolitan brokers coming into their market and dominating,” he says. Financially, “that argument doesn’t hold water … [but] that was a fear that we really had to address.”

Still, Fouts says the task force’s recommendations will probably come to fruition “organically,” just a little later than he’d originally thought. “Those discussions started a process to change,” Fouts says. He predicts that the economies of scale are such that “it’s very possible that we’ll still see a statewide MLS over time.”

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