Real estate industry must tame syndication 'beast'
Letter to the EditorBy Inman News, Tuesday, January 31, 2012.
Real estate syndication image
I know that Brian Rayl and many others have all of the best intentions on the syndicated listing discussion. I respect their opinions but wholeheartedly disagree.
My perspective comes from being in the business for 25 years, and I consider that I have always been in front of the technology curve. I work in a two-town marketplace on Boston's North Shore but believe that this issue is the same in any market. Right now, I embrace the beast that I am about to "diss" because it is what our customers expect: comprehensive access to and exposure of every property available for sale.
We are all in the business as professionals and most of us are designated Realtors. We work hard and we prospect and nurture our customers. We make the business happen by listing real estate for sale and creating a brokerage relationship to get it sold.
We owe our listing customers the best exposure and representation, and this should most certainly include online resources.
Our problem resides in the way we disseminate our proprietary information.
For several years, I worked with a multiple listing service book. We owned it and the information in it. We were not supposed to share the book with anyone else (ha!) and the listing broker represented each listing. If you wanted to see a listing, you called the listing agent.
Times changed and the information went online, from MLS vendor to the office, and we still controlled the information. Knowing each listing in the newspaper was critical because that is the only place the consumer could find your product. Then the time came for the consumer to have access to our product independently online.
We fell short as an industry to not better protect our product and proprietary information. We let the consumer cry out for information loud enough, without providing a solution, to allow us to drop our guard. Listings syndication became a wagon on the dusty trail to the Wild West of information sharing. We exposed our product but did we cheapen the product in the process? Yes, we did.
I cannot think of another product advertised online for which someone that owns or represents the owner is not the direct source of the inquiry. EBay, Amazon, Craigslist, boats, cars and beyond are represented by the owner or an agent of the owner.
To use a popular commercial for a metaphor: Do you really want the caveman to get the call on your listing? Or Ferris Bueller?
I consistently receive calls from agents well outside of our area, and it is obvious that the lead was captured online. So far, 100 percent of the inquiries have not resulted in a sale, and most often they are not even a close match.
As the market heats up our information will become more valuable. Ways to leverage our proprietary information for third-party revenue will increase. Maybe it will take more abuse of the information for everyone to realize this, or it will happen when Hooter's, Home Depot or the local bar gets into the syndication game and further cheapens our product.
The opportunity to take our business back and to represent our sellers and buyers with the best exposure and representation of the product is critical before third-party practices takes a further hold on our industry.
The first step in this process would be to provide a comprehensive, trade-driven website that shared detailed information to satisfy the consumer need. This would be the central "go-to" resource for Realtor information for the consumer, with the listing agent's information and broker's information front and center.
I think Realtor.com could do this by getting rid of their baggage and focusing on this one task. After this is done, we the brokerage community would not have the need for syndication and other sites will become less accurate and relevant.
Of course, there will be broker and IDX (Internet Data Exchange) solutions that allow us to communicate with our own buyers and sellers to satisfy their informational needs. The bottom line is that the third party aggregators will not have the upper hand on our information, we as a trade would.
One could argue about consumer protection and the practice of disclosed dual agency. Well, I can tell you that I have never sold a house from a call or email from a third-party website. If I did get a call, and was lucky enough to convert it to a showing, I would meet the customer at the property and discuss agency.
As I rarely practice disclosed dual agency, I would advise that prospect that should they have interest in the property, then I would (that individual) to my manager to discuss other agents to work with.
Or, as most areas allow for, I could offer disclosed dual agency. I might add that it is even more rare that a buyer purchases the house that the buyer inquired about initially.
As we are coming from two totally different perspectives on this, I will only respond to Mr. Rayl's "major question."
I stand by my conviction, 100 percent, that the display of a listed property, with the misleading representation that it is someone else's proprietary information, is not at all in (consumers') best interest.
Furthermore, it is my fiduciary responsibility to represent the property that (the seller) contracted me to with a certain level of expertise and syndication, and a scattered syndication approach does not provide that in any way.
If we build a better mousetrap, we can give better representation and service to our clients and properly represent our listings to the buyer community. Feeding the syndication (platforms) will only grow the beast, and buying your listings back from them will be a necessity.
Monitoring all of the syndication tentacles will make it a full-time job to track the information and analytics, if not make it impossible. We own the contracts for the business and we should decide how we want that business represented.
We are the merchants in the trade organization called the National Association of Realtors, and we should call for change in the culture of the Wild West before it is too late.
Real estate agent
William Raveis Real Estate
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