Last Fall the Department of Justice implemented a settlement with the National Association of Realtors giving Sellers the right to opt out of their having an Automated Valuation Model (AVM) or user generated comments displayed on their home's listing on Virtual Office Websites (VOWs). There was a lot of speculation about this settlement when it was announced, and people especially wondered what this would mean for Zillow, a site known for its Zestimate (AVM).
Now that some time has passed, the answer is, not much. Why? Because Zillow isn't a VOW. In case you aren't familiar with a VOW, it is a real estate agent or broker website where someone must give contact information, get a password, and then can do searches of all available MLS listings. [
Every listing on Zillow is there because the agent, broker, mls or home owner has intentionally given us the information to display on Zillow. Sometimes the listing information comes directly to us, through a broker feed for example. And sometimes it comes to us via a third party syndicator like Postlets, Point2, or The Real Estate Book. The biggest third party provider of listing information for us is ListHub, as they handle syndication for many MLSs across the country. We always show the source of the listing information near the bottom of the page.
Under the DOJ settlement, the seller has to affirmatively request not to have AVMs or user comments on VOW sites showing the listing. Recently some MLSs in ListHub's system have been applying the DOJ ruling beyond just VOW sites, to real estate marketing sites as well. This means when an agent selects "no" to having a client's home appear on a VOW site that has AVMs, the agent is also saying no to marketing exposure on non-VOW sites. I listed the MLSs that are now doing this below.
As I talk to real estate professionals about this decision, a common misconception I hear is that they think when this option is exercised, the website (such as Zillow) will simply remove the valuation or user comments functionality from the site, but the listing itself will still be there. This is not the case. When you say ‘no' to this option, your listing is simply not showing up on these sites at all. So by forgoing this, you are opting not to get exposure on one of the most visited trafficked consumer websites, Zillow, plus a handful of others such as Yahoo! Real Estate and Trulia.
Obviously we want the listings on Zillow, but outside of this, I worry the decision to do this could come back to haunt the agent, if not properly explained upfront. I worry that the agent asks "do you want an AVM on your listing?" and let's say the Seller says "No". The agent, as usual, then goes on to describe all the ways they are going to market their home online. The Seller then goes to check all the sites the agent promised and doesn't find their listing on Zillow. Instead the seller just sees the public record facts and the Zestimate for their home, but no listing information, no extra photos, no sales price, and no agent contact information. You know what the next call will be.
When I talk to MLSs about this, they say they are just enforcing the DOJ settlement. But the settlement applies to VOWs, not sites where the agent, broker and seller have sent their listing information. I feel it is wrong for these MLSs to extend the settlement on to non VOW sites. This practice misinterprets NAR's VOW policy, and reduces the amount of marketing exposure a seller is receiving online.
I hope this helps clear up the settlement and how Zillow is involved with it. If your MLS is one of the ones listed before, it is important for you to know what you are opting in and out of. Below are some resources if you would like to familiarize yourself more with the rulings. Or please feel free to contact me directly if you would like to discuss further.
- Arkansas Regional MLS
- Brunswick County MLS
- Coastal Carolina Association of Realtors®
- Central Virginia Regional MLS
- Metropolitan Regional Information Systems
- Northern Nevada Regional MLS
- North Texas Real Estate Information Services
- Outer Banks Association of Realtors®
- Realtor Association of Northwest Illinois
- Sandicor
- SOCAL MLS
- Triangle MLS
Resources:
Final Judgment, Exhibit A, Section II.5.c
" The seller also has a right to request that a VOW's comments, blogs or automated market value estimate about its listing be disabled or discontinued (although the VOW can state that those features have been disabled) "at the request of the seller." http://www.car.org/legal/mls/summary-status-doj-nar-vow/
Definitions of VOW and IDX websites
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