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Monopoly my a..!

Ok, today I want to talk about monopolies and how some folks seem to think that NAR and it's members are monopolizing real estate and prohibiting other business models from participating in our closed "secret society". Now folks, I'm not one to use big words and I don't waste much time reading about the DOJ and their law suit against NAR, so if my response to all this sounds too simple, well, it is. I can only respond based on my perspective and how things are in my market. So with that in mind, my first reaction is "Monopoly my ass!"

Real Estate, at least in my little world, is very, very competitive. The consumer is bombarded with choices of who to do business with and how much they are willing to pay. Everyone and their brother has a Real Estate license. We have many "discount" brokerages and to the best of my knowledge all of them are REALTORS® and are part of our "secret society". Commissions are all over the board. There is no such thing as a fixed commission. I compete with "discounters" on just about every listing appointment I go on and I win the listing about 95% of the time. I win because in his slower market the consumer knows they need the best person for the job, not the cheapest.

When I hear all this talk about monopoly, I truly believe the people that are saying it are just plain ignorant of our business. They are simply repeating the "catch phrase" du jour. I also, believe they are underestimating the consumer. The consumer is not stupid, they know they have choices and they are quite capable of making the right one for their needs, based on what they are trying to achieve, not based on what the DOJ or others perceive their needs to be.

The Seller can go FSBO, they can pay a marketing company for a "selling package", they can pay a fee to have their property entered into the MLS, they can choose a "discounter", they can hire a full service-full fee REALTOR® and choose from a variety of commission structures, they can use Craig's List or Zillow to advertise their property and many, many more options that are available to them. Monopoly? I think not.

The Buyer can go it alone, they can use a commission rebate company or they can hire a full service-full fee REALTOR®. They too, can choose the program that best fits their needs. Is having choices a monopoly?

Real Estate is one of the most market driven and competitive businesses out there. Heck, any one can get into Real Estate. In most states, all you have to do is attend a few weeks of classes and pass a simple test. If you want to be a REALTOR® then all you have to do is write a check. That's it. Write a check and you are a REALTOR®. No test, no training required, no formal education needed and no denial! If you have a valid Real Estate license there are NO qualifications at all to become a REALTOR®. Does that sound like a monopoly to you?

Another fallacy, is that you have to be a REALTOR® to have access to the MLS. Well, that's not true either. ALL listings that are in the MLS can be found online. Also, rules for joining the MLS vary from board to board. Some are controlled by the LOCAL association and some aren't. Every area makes their own rules. So how is that a monopoly?

So really, I guess the issue is, not whether or not NAR has a monopoly but what can we do to get in on the money train? Well, come on in, it's open to anyone who has the will to do what it takes to be successful in this business. I welcome all of you. Come on down to my market and let's compete. Charge what you want, do what you want. I will personally be happy to blow you away and prove to you it has nothing to do with how much money we charge. It does however have everything to do with helping people achieve their goals and helping then to stay focused on the end result. By the way, you just landed on Boardwalk. You owe me $2,000. Now that's monopoly! Giddy up!

Posted by Bryant Tutas Broker/REALTOR(R) Tutas Towne Realty, Inc on 02/02/2007 05:09 PM

Comments (78)

doj, nar, monopoly, opinion

78 Comments on Monopoly my a..!

FEB

2007

Reserved Parking For #1 "The Lovely Wife"...TLW...ROAR!

Hubba! Bubba! Wink. Wink. Darlin'...This is my comment :)

You have b***s made of steel :)

TLW...ROAR aka Mrs. Billie Tutas :)

Bryant, don't tell TLW but I love when you say Giddy up!

I agree with everything you say; well, at least in this post! I even encouraged some people to go fsbo this week, which ok, doesn't happen often, but was needed to save them money due to predatory lending. I have a nickel does that help?

Bravo! When it comes right down to it, people do busness with people (maybe REALTORS) who will get them the best deal from those People's perspective. Sometimes it is MORE money, sometimes it is getting the house they want, sometimes it is LESS money. But, if a real estate marketer is MORE professional and NOT a member of REALTORS, that person has just as good a chance at the business.

Real estate marketer, if you want the tools, pay the dues. Don't go whining and wasting energy to make those who do pay for the tools share up with you. BE PROFESSIONAL and MATURE! Read this post.

The DOJ isn't calling the whole shabang monopolistic, just the datashare.

Bryant Great Blog ! I have to come back and finish reading it so this is my way of marking it to come back to it.....

Another great blog!! As the market balances the lawsuit will probably just go away.

The DOJ isn't calling the whole shabang monopolistic, just the datashare

Mikey's correct but the DOJ is wrong. Local MLS boards are private corporations, owned by the members. Shouldn't they be allowd to create proprietary information?

BB: I'm guessing this post got you all worked up:

http://www.bloodhoundrealty.com/BloodhoundBlog/?p=978

I agree with Brian, NAR should be allowed to have their own system.

Bryant, Thank you. I have been reading all the monopoly posts lately and have had the same reaction as you.
"We have many "discount" brokerages and to the best of my knowledge all of them are REALTORS® and are part of our "secret society"."

Also, I dont know about every MLS, but ours has a free consumer site that has infinate access to ALL information, with no log in. How is THAT a monopoly?

Absoutely wonderful post, Bryant. I was considering writing something about this, but now I can resreve my energy for posting links about wind chimes. :o)

**update: Our consumer site has free access to all ACTIVE listings.**

I'm in. I always agree with BB, Brian and Carole. I hardly have to think anymore!

Te issue is the criers are saying "What's mine is mine, and what's yours is mine." If this was the soda industry the DOJ would be telling Coca Cola to give up their recipe.

Linda, we can read Mariana's post on wind chimes. I just want to add this: it's a free market society, there are tons of FSBO websites, and to me, anyone can develop their own system if they want. What is all the bruhaha about. Ok I'm going back to not thinking

Mikey, this post is about the DOJ and others. Here is a perfect example of some one who doesn't know what they are talking about, IMO. MLS data is a part of a confidential agreement between me and my seller. Where and how it is distributed is OUR decision not the DOJs. But in reality the info is already out there for the world to see. Just go to Realtor.com

BB...This is my favorite of all your posts! Right on...here in NH real estate is not a monopoly ...no fear of the internet...no closed MLS...discount brokerage they've been around forever...competition tons of it. Transparency...oh yeah...everyone knows what the cost is and who pays it,..we've had Full written disclosure requirements for years. Absolutely great post !!!

Bryant,

That was the greatest!!! What a way to get my juices flowing for blogging!!! Excellent post.

Ok Bryant I just read that post. Commissions are all over the map so again I agree with you.

I had read all the BH posts regarding this, so here is my p.s. Did you know... Based on a recent Texas A&M study:

The national average commission was 5.1% with no buy side OR sell side reaching 3%. How does THAT create a monopoly on 6%?
The regions that had the lowest average commissions were regions dominated by ReMax?

Again ... how does all of this create a monopoly? Just wondering...

(great, now I want to dig out my monopoly game. I get to be the shoe!)

I wish the DOJ would take a look at Comcast. Talk about a monopoly

Broker Bryant, here is a link to the joint written comments to the DOJ/FTC on competetion submitted by NAR. A lot of the complaint by the DOJ is based on the VOW policy originally drafted by NAR years ago. By the time the lawsuit came about NAR had already ammended it's policy. The main gist of the suit is the opt-out policy of the VOW. The new policy is now called ILD (Internet Listing Display).

Of course, the other business practices or new business models is also a key element to the suit. I think NAR will be able to defend this with positive results.

Monopoly? I don't think so....

Great job.....

Thanks for the link Jay, I'll have to read through it. Doesn't surprise me at all the DOJ is using out dated info for their complaint. That's too funny:) I don't keep up with all that stuff, I'm way too busy playing monopoly.

Points on monopoly and choice - agreed.

Has anyone considered how much the consumer (who in the final analysis, pays) is paying for all the time, paperwork, legal fees etc. in this DOJ quest against NAR?

Bryant, great post and yes, that "other post" was a joke. I couldn't help but chime in just a tad. I know everyone has their opinions of situations but when you have ignorance running rampant throughout those opinions, it can get frustrating REAL quick. All the monopoly talk and all the talk about how Realtors are overpaid is laughable. Every few years though, somebody is the target and I guess it's our turns. As a general rule, the only ones that run around claiming others are overpaid are the uneducated who have no experience in said field.

BB.. well said and Thank you.. What is this fixation on 6%.. in my area ( So CA) 6% fees disappeared at least 15 years.. the fees are all over the place and the choices are as you noted wide.

Real Estate is one of the most market driven and competitive businesses out there. Heck, any one can get into Real Estate. In most states, all you have to do is attend a few weeks of classes and pass a simple test. If you want to be a REALTOR® then all you have to do is write a check. That's it. Write a check and you are a REALTOR®. No test, no training required, no formal education needed and no denial! If you have a valid Real Estate license there are NO qualifications at all to become a REALTOR®.

I find it interesting that better training and education are not mentioned in the DOJ concerns about real estate. Wouldn't tougher licensing standards be the first step in protecting the consumer?

But then I have a little theory that DOJ doesn't give a hoot about the consumer and that much of the outcry against REALTORS® is at the urging and behest of third party companies that want total access to our information without any cost.... they don't want to have to get a real estate license or join an MLS system or conform to any standards. This is more about new ways for these aggregators to do business cheaper. .. no disrespect to Brad Inman but he made an awful lot of money selling fake leads to agents because the consumer didn't know what he was getting into when he searched for a house or an agent on HomeGain.

Oh.. and has anyone else noticed that much of the hue and cry against us is led by lawyers? In CA we don't use attorneys to close on homes so I don't know much about their role or their fees but it does make one wonder who the consumer would have to turn to if we are out of business

Kaye, you wrote this:

I find it interesting that better training and education are not mentioned in the DOJ concerns about real estate. Wouldn't tougher licensing standards be the first step in protecting the consumer?

This would be very difficult to achieve because licensing is a state by state thing BUT NAR could very well raise the bar for REALTOR(R) membership. This is one area that change could take place and it could take place quickly. NAR needs to step up and make a change. How great would that be? How much positive effect would that have on the consumer? Make being a REALTOR(R) mean something and a lot of these other issues go away.

Ryan, you'll get no argument from me.

Sharon, very good point. And you know, I don't hear the consumer complaining about their choices.

I really appreciate everyone reading and commenting. I know this topic has been beaten to death but had this in me today and had to get it out.

"The VOW Policy permits brokers to selectively or generally withhold their clients' listings from VOW operators by means of an "opt-out" right. In essence, the VOW Policy allows traditional brokers to block the customers of targeted competitors from using the Internet to review the same set of MLS listings that the traditional brokers provide to their customers."

The whole DOJ lawsuit that Bryant refers to boils down to the above sentence. It isn't about commissions.

Sorry for posting twice in a row, but as far as educational requirements, it simply wouldn't happen. IMHO, the NARs policies are about protecting the brokers and keeping the membership as large as possible, the agents benefit from most of its policies but they aren't the primary consideration at all just a revenue stream for the brokerages and the NAR.

So, Bryant, tell us how you really feel! :)

Great post, BTW. I am in complete agreement. There is no logic to their claim as I see it.

Jeff

Mikey,

Here is the DOJ filing. It's all about the commission. They are accusing REALTORS(R) of anti trust violations against companies that charge a lower commission. Supposedly we are doing this by not giving then access to our listings. But make no mistake about it, as Brian Brady would say, "It's all about the Benjamins"

Now here is the post that started me on this post.

Mikey, I will agree with you on that. NAR is all about growth and making it more difficult to become a REALTOR(R) ain't ever going to happen. There go those Benjamins again:)

Bryant-

If you search the lawsuit for the word "commission" it only comes up 9 times in 14 pages, of them only once in the actual lawsuit part of the complaint posted here:

"The chairman of the board of RE/MAX, the nation's second-largest real estate franchisor, publicly expressed his concern that these Internet sites would inevitably place downward pressure on brokers' commission rates."

They are saying not allowing MLS listings to be redistributable by any participating brokerage is anti-competitive and would be used by the big brokerages to punish the brokerages with whose business models they find threatening to them.

Mikey, Let me put it is way. lets say I have 100 properties listed in my market, my competitor has only a few but they want to be able to build a nice website to attract buyers. Once they have the buyers register, their entire biz plan is to resale those buyer leads to my agents. They are attracting the buyers by using my inventory and then selling them back to me. Why should I have to do that if I choose not to? This is a decision that if made, would be made by me and my seller. NOT the DOJ. Now personally since I am a listing broker and I control the listing I have no problem with my listings being distributed everywhere. But it's a choice I should have the right to make.

If a VOW wants to display all available inventory then it's very simple, join the board and the MLS and have at it. No one is saying they can't do that. The MLSs are privately owned companies. They don't discriminate in any way and they don't restrict who can join. The DOJ suit is a joke and a waste of tax payers money.

But again this post is not about the DOJ lawsuit. As I stated in my first few lines of the post I don't waste my time reading stuff like that. This post is about the misconception of the DOJ and others that think the REALOR(R) organization is a monopoly. BUT you can be sure it IS about the money.

Now you know from my posts in the past that I welcome ALL business models. I do not have any problem with any of them. The problem I have is with folks not in the business that write stuff and throw it out there when they are clueless about what it is we do and how we do it. And they prove that by calling NAR a monopoly. But what the hell do I know:)

Well, we can't raise the entry level because the DOJ claims that would limit the choices of the consumer who doesn't want full service. We can't require minimum service because that would limit the consumer choices for brokers who give little to no service.

The only thing left is full service and I don't see much in my area of high commissions. Folks ask about negotiating before you've even looked at a house or met with a buyer.

Is there any other industry where the federal government is telling over a million self employed business persons how much they can charge for services to the consumer when those business persons all compete with each other for the business.

I wish the feds would tell my plumber and my attorney that they are charging too much.

Thanks for the rant. Made my day. I turned away two buyers today because they were shopping for rebates before even telling me what kind of real estate they are looking for. They'll have to go somewhere else. No one tells me what I can charge for my time. I know what I'm doing and I know what the value of my services to a buyer buying a $750,000 property. I make sure the i's are dotted and the t's crossed and I know where the i's and the t's are.

Lenn

It isn't about the small fries, it is about the guys who control the majority of the listings Realogy, Re/Max being able to stop any new guys from coming along and upsetting their business model. With this rule in place, nothing is stopping the dominant brokerage from saying "I don't like Broker Bryant, I'm not displaying his listings through my sites MLS portal anymore" and squashing you like a grape. The people coming to their site, thinking they are using the MLS won't see the available marketplace but only a subset, and you and your customers would be explicitly denied showings. It isn't a level playing field.

You may welcome all business models, but I assure you, the big guys DO NOT.

Lenn, I knew you would like this one. I'm with you 100%. I'll charge what I want when I want.

Mikey, What you just said is exactly what I'm talking about. It IS not the way the real world of Real Estate works. In Reality ALL REALTORS(R) search properties through the MLS. So what if REMax doesn't have my listings on their web site. I don't care. If the buyer contacts them, their REALTOR(R) is then going to search the MLS(where my listings are) to find suitable properties to show. REALTORS(R) are independent contractors, they want to sell a house and will show MLS listings regardless of whether or not their office has them on their web site. Now if the buyers agent is not showing particular listings because of the commission being offered then that is a whole different ball game. They don't have to show them, but they do need to disclose this to the buyer and that's where the Buyers Broker Agreement comes in.

Just to clarify: The MLS has never been available to the consumer and is still not available to the consumer. What you are referring to are active listings. That is only a very small portion of the MLS.

Bryant,

I was led to your post while searching for answers - and boy did I find them. I'm new to the Active Rain community, and made a post earlier about the supposed bubble in the Seattle, WA market where I live. The topic splintered slightly into a discussion of issues affecting housing affordability (which was great) - but then (perhaps unintentionally) someone seriously tried to derail the post by suggesting agents lower their fees to make housing more affordable. Though not directly related to the topic of your post, you've really helped me get some perspective on how to respond to this person's statement. Your 2nd, 4th, and 5th paragraphs were especially helpful. So, thank you!

Mikey:

Listen to Bryant...it's always about the money.. we all share information on the MLS.. the idea that we don't is nonsense... in fact most MLS organizations have strict rules that encourage sharing and penalize not sharing... We are not stupid...agents know it is simply good business.. My client wants his home sold.. today.. why would I not share the information with someone who might be able to help that happen..

"Just to clarify: The MLS has never been available to the consumer and is still not available to the consumer. What you are referring to are active listings. That is only a very small portion of the MLS."

But it IS a portion of the MLS and up until now brokerages could use the listing any way they wanted within broad parameters. Now they changed it so that another brokerage could decide not to let you use that portion of the MLS because they dont like your business model. Now tell me, If Century 21, Coldwell Banker, Re/Max, Keller Williams all decided not to show your house on their websites, and 75% of home shoppers start their shopping on the internet, what chance do you think you have to survive?

This is simply a power play by the LARGE brokerages to keep (or increase) market share and the government is calling them on it.

"If you have a valid Real Estate license there are NO qualifications at all to become a REALTOR®." So, if there is no monopoly, then what is the value of being a REALTOR® :)

Bryant. well said, I can't agree with you more,

FEB

2007

In NYC they do not share, no lockboxes no mls. Not all areas are creatied equal.

Nice job BB. I have been talking to neightbors and friends and FSBO's in my area and am learning that what most people want is a good realtor who will do a good job. They don't want to understand the complexities of marketing. They want to pay me and have me take care of everthing so they don't have to worry about it or think about it.

BB,

Great job....as usual. I must admit that I loved your punch line......most appropriate!

So Mikey do you think Exxon needs to share their data with Mobil and Texaco showing all their oil exploration data??

McDonald's needs to share their "secret sauce" receipe with Burger King??

Why, just because we as Realtors have worked for years building databases of homes for sale and home sale stats, are we now obligated to share it with very Tom, Dick, and Zillow that asks???

Mikey, You have it backwards. At least in my area. As a broker I have the option of "opting out" of the IDX system. I can choose for my listings not be displayed in the IDX systen. However I can not decide to pick and choose whose listings are displayed if I place the IDX system on my web site. ReMax or whoever can choose to not have IDX on their web site at all but if they do have it, they cannot pick and choose whose listings will show up. The way you are explaining it CANNOT happen in my area. The system will not allow it.

AS Ardell explained in her comment ALL areas are differrent. The DOJ thinks RE is national and it's not.

Jeff, the value of being a REALTOR(R) is all the other things our association does for us. We are the largest PAC in the country for starters. We get free education at our boards. The Florida Ass. has an awesome website that gives me free contact management, transaction materials and much much more. If you were a REALTOR(R) you would understand all the member benefits. Because they provide me with all the tools I need to conduct my business in a professional manner the consumer benefits as well. It doesn't mean I'm any better than a non-realtor agent but it does mean I'm better equiped to do my job. And the MLS is one piece of the equation.

BB,

Excellent, excellent, excellent!!!

You are 100% on target with this one!

I agree that http://www.bloodhoundrealty.com/BloodhoundBlog/?p=978 is ridiculous!

If you have time, check out what I commented there.

Thanks for the great post!

Lucky :)

Bryant-"Mikey, You have it backwards. At least in my area. As a broker I have the option of "opting out" of the IDX system. I can choose for my listings not be displayed in the IDX systen. However I can not decide to pick and choose whose listings are displayed if I place the IDX system on my web site. ReMax or whoever can choose to not have IDX on their web site at all but if they do have it, they cannot pick and choose whose listings will show up. The way you are explaining it CANNOT happen in my area. The system will not allow it."

That is because the NAR revised its policy because they were trying from getting an unfavorable ruling placed against them. Now the fight is an all or nothing battle over allowing all IDX data being displayed online. This is a battle over LARGE brokerages gaining market share and the DOJ trying to keep the marketplace open to new (or smaller) brokerage competition.

Mikey, My IDX system has always been like that. It has not changed in my area since it's inception. I guess this is one of those things we we'll have to let the courts decide. Frankly, it won't affect my buisness either way.

Lucky, great post over there! You said everything I was thinking about.

Didn't they settle the suit already? I hope so. Someone is alway suing someone over something. It's just ridiculous. I agree though. The last thing we need is MORE competition......

FEB

2007

Ryan: Thanks! I was like BB, it just p---ed me off!

BB: Did you read it yet? What did you think?

Thanks,

Lucky :)

Lucky, I loved your comment on over at Bloodhound. You should have made a post out of that! I can't even imagine how our business could be more competitive that it already is. Folks just don't get it. In my market there were approximately 1,700 closed transactions last year. I was the number one agent with 40 closings! There were only 5 agents with more than 10 sales. The other 1600 or so closings were handled by almost as many agents. Hows that for competition?

Hello Broker Bryant,

Interesting choice for your blog today. I agree that monopoly is not quite the right definition for what is happening. I am sure that this sort of thing varies greatly in different areas and markets. But, thought you might like to hear about what happens here in Bakersfield.

A year or so before my wife and I were engaged to be married she wanted to buy a house for herself. She had a very limited price range and hired one of her real estate clients to find a house for her (she is escrow officer). Her agent brought her many listing to look at but none were quite right. So, just like yourself, I am a resourceful guy and decided to take a look at the Bakersfield MLS for her (thankfully us non agents have access to the scaled down version of the MLS here in Bako). Turns out I found another 4 homes that her agent didn't even show her. WHY? Because these listings were from Help-U-Sell and Assist-2-Sell. According to her agent "I didn't show you these homes because they are always so difficult to deal with". Turns out, even with the dire predictions, my now wife purchased this property with no problems. (And we will never use that agent again, along with my friends)

After this experience I spoke with some real estate agent friends and they flat out told me that all the main real estate shops in town actually TELL their agents to do whatever they can to avoid the discount broker listings. One agent told me that if you as an agent participate in the sell of one of these houses then you better have a very good reason because the owners are NOT going to be happy. The reason, they don't like the discount fees and are trying to hold everything to the normal 6%.

Funny thing is, this isn't the only time I have helped buyers out. Just the other day I found another home for one of my wifes friends. Sure enough, the agent didn't show her the discount listings. Now, this may not be a monopoly but there is DEFINITELY a concerted effort in Bakersfield, weather spoken or unspoken, to not allow the discount brokers a fair deal. If they didn't HAVE to allow them on the MLS then they wouldn't. Unfortunately, most buyers won't take the time to make sure their agent is doing all they can for them. Of course, they shouldn't have to.

This is widespread here. It's not just a few bad apples. Monopoly? At least until buyers become sophisticated enough to realize they can search homes for themselves.

Wow Ryan, that is very interesting. My market has many Help-u-Sell and Assist to Sell offices. As well as several other "discounters". It is normal, at least in my market, for the co-broke commission being offered on these listings to be in line with all other listings. The discount they are offering is usually on the listing side not the selling side. My assumption would be that it is the same in your area. If that's true, then they are doing some serious "anti-trust" violations and should be reported. As an "Agent" they cannot limit what properties they are showing their clients unless this has been discussed and agreed before hand, via a Buyers Broker Agreement.

Ryan, Realtors or Agents that do what you have stated are breaking the law plain and simple. They should be reported. Activity like that pisses me off. And I can assure you it happens quite often, everywhere.

I just entered this post into the Carnival of Real Estate for the world to see, so I really appreciate you commenting. Maybe some folks will read it and clean up their act. Most of the folks in our profession are honest hard working people and the few that act like this make us all look bad.

BB,

Well, you asked for it:

http://activerain.com/blogsview/41656/Department-of-Justice-is

is my blog response to Mr. Cook's warped perspective.

Thanks for encouraging me!

Lucky :)

FEB

2007

Darlin' (Broker Bryant)...

Congratulations. Wink. Wink.

This post made it to the top 10 in:

The Carnival Of Real Estate

Good job. I am so proud of you :) ROAR!

TLW...ROAR! ROAR! ROAR!

FEB

2007

I think if you look more closely at those crusading against the industry, you will find most of them have a future revenue model for themselves if they can convince the consumer that the industry needs to change.

FEB

2007

If there's a monopoly in real estate it's at the state licensure level...what do they really do for anyone, and why can't they figure out the first thing about commercial deals?

FEB

2007

I think if you look more closely at those crusading against the industry, you will find most of them have a future revenue model for themselves

Gosh, you think? Dustin Luther said it best in his seminar in Long Beach. The tech guys felt the amount of money being made was an inefficient market that could be exploited. There are 3 million real estate licensees in the USA; one for every 70 families. If 1/3 of those families are perpetual renters, that means one for every 50 families.

Monopoly? My A$$!

Mr Brady, How's it going man. As you would say, "It's all about the Benjamins" You know I have NEVER in hundreds of transactions ever had one of my customers complain about how much money I make.

MAR

2007

With so many options that a consumer has, it seems crazy to think that the word monopoly can be used in the same sentence!

MAR

2007

Excellent Blog. Thanks

MAY

2007

Great job, If their was no compition we wouldn't have such a big turn over in agents or so many new agents each year the good stay the bad weed themselves out.

don't have 2,000 put here's some $200 for passing go it's all you get

MAY

2007

Great post, Bryant. The discounters in our area have been steadily losing influence after a spike about 3 years ago.

OCT

2007

holy crap what resolution screen do i need to see this webpage properly? i have to scroll about 3 pages over

Hey, internet guy. I think it was the scam comment above yours that was messing it up . I deleted it so it be fine now.

FEB

2008

NAR Is a Monopoly! I am a realtor myself, but I at least know what I am a part of.

In my professional opinion: NAR is a monopoly. Why? Because the MLS has all the leverage. In order to buy and sell for your clients, you really must become a Realtor to have any chance. This is a monopoly.

There is a lot of compeition within the monopoly. For instance: Keller Wiliams vs, Remax, vs. Coldwell Banker, etc. But ultimately, they are all part of the same company: a non profit organization called the National Association of Realtors.

Because of this monopoly, there are many hoops that new real estate agents must jump through. First of all the fees for getting started, as well as the ongoing MLS fees are high. This makes it tough for beginners in the business. Even part-time referral reps would have to plump down quite a bit of money.

Not to mention the leverage they have with the politicians. Have any of you seen the license requirements in Texas? they are ridiculous! 210 hours of education, most of which will never be used in the business. It is obvious attempt by the state to weed out as many people as possible. We all know what drives politicians right? Money!

It is no secret that Texas Association of Realtors and Texas Real Estate Commission are BFF, and I'm sure it is the same in other states.

Statewide mls's make more sense to me. I can only access mls in the austin area. I have real estate client needs all over the state, San Anonio, Houston, Dallas, Lubbock, etc. I am reduced to referring the client to somebody who I know will not take care of my client the way that I will.

The sad thing is, we are all perpetuating this monopoly by continuing to participate.

Tim, The MLS is not a part of NAR. Some are owned by the local associations and some aren't. In fact in many areas being a REALTOR(R) is not required to be a member of the MLS.

As always I appreciate all opinions but do you really feel the bar for becoming a REALTOR(R) is too high? It does sound like Texas is a little more stringent than Florida but even 210 hours is very minimal compared to most licensed professions. Heck try to get a license to cut hair! Their hours are outrageous.

I do agree State wide MLS would make sense. We are actually moving that direction in Florida which is a very good thing. Especially for Brokers who want to have satellite offices in other areas.

Tim I noticed this was your first visit to ActiveRain. I hope you stick around and participate. This place is a tremendous opportunity to increase your business. And unlike MAR.....it's FREE!!!

Let me know if I can help in anyway.

Bryant,

you must join the local association in order to access the full service mls. yes non realtors may access it, but it is limited.

The bar was not too high for myself obviously, but what about all of those people (the vast majority of middle income america) who are struggling to make ends meet because they have credit card debt, and living above their means, and getting ripped of by mortgage companies? These are the vast majority of people who I see out there in the world, and they are the people who I am interested in recruiting into this business. $3000 to start up is not easy for many people.

Why do I want to recruit part-time referral reps? Because Americans need extra income!! Example: a stay at home mom gets her license, then she refers me to a friend. I sell her friend's house. 300,000 x .03 = 9000 total GCI. I send 30% referral fee to the stay-at-home mom. 9000 * .30 = 2700. She splits it with her broker (which is my broker as well), 2700 *.7 = $1890. The stay at home mom makes $1890. I make $4410. She's happy, I'm happy, her friend is happy, and the company is happy!

We just had one make $2000 the day she was in the hospital having a baby. That kind of money can change a family's life.

Why am I so happy? because I didn't have to do anything for the lead. Why is the stay at home mom happy? Because she did not have to spend so much time working the deal. Why is my broker happy? because they got paid just as always.

We are building our business this way, and because of this, licensing and getting started needs to be easier. When we have another Non-profit, or company that challenges, and competes head to head with Realtors, then we will have true competition.

I would take 10, 20, 30+ of these part-time referral reps. These people will generate leads for you so that you don't have spend everything on marketing. In addition, you can mentor and train them along the way, and when they are ready to go full-time, you now have somebody on your team who knows what they are doing, and then they can go and build their own teams, and you get the profit share long term (if your with Keller Williams anyway).

This is a little concept called network marketing, in case you didn't notice. It still baffles me that nobody really has embraced network marketing and brought it to it's full potential in real estate yet. Keller Williams is the best system I've seen so far, but I still believe there could be better systems. I guess we'll have to wait and see what happens in the future.

This is my perspective.

Tim, In my area, Florida, there are many "referral only" companies. Brokers normally set up a separate company to handle these transactions so the licensees do not have to join the Board or pay MLS dues. In fact most MLSs are able to provide "exceptions" for agents that are only active for referral purposes. Have you tried this?

The reason they have rules requiring ALL agents of the broker to join the board and the MLS is because there are many folks that try to avoid paying these dues even though they are using the services. And that's not fair to the rest of us who willingly pay.

No one has to be a REALTOR(R) and no one has to join the MLS. This is not a requirement anywhere to become licensed to sell real estate. NAR is a voluntary organization. The MLS was put together by REALTORS(R) so we have a place to cooperate with REALTORS(R) in the listing and selling of our inventory.

There is nothing prohibiting folks that don't want to participate from doing it their own way. The MLS is not a public utility but is a private company that requires a membership in order to participate. In no way can this be construed as a monopoly.

My personal opinion is that the bar to become a licensee is way too low. I take my job very serious and I'm not a fan of "referral only" businesses. But they are legal and I welcome them into the market as I do any biz model. I don't have to like it to accept it.

By the way I have embraced network marketing. I'm a broker. I get paid on every deal agents under me do. Also as a member of the MLS I get paid when others show and sell my listings. Network marketing is what being a broker is all about.

FEB

2008

Gentlemen,

Thank you for an educated, civil discussion of our business and the opportunities it presents!

Very well done!

Lucky :)

Bryant,

Your points are valid. In Texas, however, referral companies are few and far between. I guess it's because getting licensed here is such a pain the a$$.

I am aware of the ability to join the association without getting the MLS. This will dramatically reduce the amount of annual expenses for a part-time referral rep. However, here in my area (I can't speak for anywhere else), you must join the association if your broker has joined. Vice Versa, all broker's agents must join. I suppose that some may join and not get mls, which could help a part-time referral rep in the beginning. Setting up a seperate company, as you've mentioned is something I've considered. Your point is well taken.

I, however am a big fan of referral only business, for the reasons I've mentioned above: to help people make extra income, and to provide free leads for myself and my team through network marketing.

As far as a monopoly: I am aware that it is not mandatory to be a REALTOR. As far as I know, a monoply doesn't mean that it is mandatory. Likewise, I am not necessarily against monoplies. I believe in free enterprise, and I don't think the Federal Govt., has any business breaking up monopolies. If it's good for everybody than there's nothing wrong with it.

For certain situations: probably few a far between, NAR is not the best option (but it is still basically a monoply in my opinion)

I recently read the biography of John D. Rockefeller. The book is called Titan. His company Standard Oil, was built in such a way that he helped thousands of people to not only profit in business, but to also afford kerosene at an affordable price to the mass public. I believe he was in it to help others. Standard Oil became a monopoly. Was this wrong? I don't believe so. They couldn't beat him, so they joined him, and they all became wealthy together.

This in a way is NAR. However, there's nothing from preventing somebody from going head-to-head with them someday.

Guess we'll have to see what happens.

APR

2008

Nice point,

However, the problem here is that for commisions to be insured, you must be a member of the NAR. Moreover, if a realtor list a property and it is not listed with the MLS in 3 days, then that realtor is charged a fee. So, we can deduce for the former and latter that:

1) to have 'protection' you must be a member of NRA

2) if you are a member of NRA, you must use MLS.

3) IF you don’t use MLS, you are fined money

4) Thus, the MLS and NRA are violating the ability to perform free trade

5) the inability for private capitals to perform free trade due to an exterior organization is a violation of free trade laws

"Again, trade is a social act. Whoever undertakes to sell any description of goods to the public, does what affects the interest of other persons, and of society in general; and thus his conduct, in principle, comes within the jurisdiction of society... both the cheapness and the good quality of commodities are most effectually provided for by leaving the producers and sellers perfectly free, under the sole check of equal freedom to the buyers for supplying themselves elsewhere. This is the so-called doctrine of Free Trade, which rests on grounds different from, though equally solid with, the principle of individual liberty asserted in this Essay. Restrictions on trade, or on production for purposes of trade, are indeed restraints; and all restraint, qua restraint, is an evil"

Yes, you are right that the public can 'list' their house on line somewhere else, but there chances are limited in being able to sell that house because of the market dominance of the NRA. Additionally, sales agents are almost obligated to use NRA as a service and thus the NRA is indirectly monopolizing the market of service professionals. The loophole that the NRA uses is their "no profit status" and that allows them to avoid major antitrust laws. So, they are a monopoly...just a terrible and legal one.

John Piccolo

Realtor

Pres. RPC International

Hi John, Thanks for stopping by. Great comment!

To ensure my commission all I have to do is have the listing Broker sign a commission agreement. I don't need to be a REALTOR(R) to do that. Of course if I am a member of the MLS then my commission amount is known upfront and although it's not a garauntee I do have some recourse against the other MLS member. BUT.....you don't have to a REALTOR(R) to join the MLS in quite a few places. However, usually MLS membership, without NAR membership, is limited to active listings. As it should be, since they would not be obligated to follow our CoE.

Asa REALTOR(R) I can't intentionally solicit other REALTORS(R) listings or customer/clients. On a non-realtor would not be restricted as such. And of course there are many other sections of our CoE that could easily be violated if a non-realtor had complete access to our listing data. It would be a playing field heavily weighted towards the non-realtor. So MLS restrictions make sense.

The NAR and the MLS are not connected, in all areas. It varies from board to board. As it should.

Look at this way. I can choose to try and sell my used car by myself. I can place ads or place it out on the curb with a sign BUT I'd probably have more success if I placed it on a lot, on consignment. But this doesn't mean car dealers have a monopoly. It just means they have better tools of the trade. And they should.

OK that may be a bad analogy. I'm tired. I think I'll come back to this in the morning.

MAY

2008

When a Realtor gets a listing, does that Realtor tell the home seller that because we are Realtors and our MLS is not open to "Real Estate Agents" you will not get 100% exposure for your home unless they become a Realtor an can not get access to our lock boxes to show your home to any buyer's they may have because we hold the key to selling your home?

When you look at your real estate licence no were does it I am a Realtor and have special privilege's over others the 1 .7 million non Realtors Agents .

When I do a listing I use two lock boxes a Supra and a combination lock box that allows non Realtors the opportunities to sell a property period, no monopoly there..

Happy 100 years

http://www.realtor.org/about_nar/nar_centennial/centennial_video

http://www.usdoj.gov/atr/cases/f211000/211009.pdf

http://www.usdoj.gov/atr/public/real_estate/index.htm

MAY

2008

Mr. Monopoly,

I'm curious. When you take a listing, do you tell your seller that every Tom, Dick, or Harry that looks over your non-Supra agent's shoulder can gain access to them and their home 24 hours per day whenever they want? Why would you ever expose them to that threat?

The NAR video was very nice!

Thanks,

Lucky :)

MAY

2008

Threat? Not..an open house is more of a threat.

Combination boxes for Non Realtors along with supra boxes eliminates the monopoly, in the days before GE Monopoly Supra Boxes, we had all sorts of boxes to gain access to homes and that system worked fine.

The NAR video shows just how long there Monopoly has been going on!!

Granted there are Non own Realtor boards MLS systems that allow ALL to participate in MLS without being or joining and boards, that way it should be and that is just one part of what the DOJ lawsuits are ALL about.

Here is just one MLS that is open to ALL. http://www.fmls.com/FMLS/FMLS_CONSUMER/default.cfm

It is Ironic that the DOJ is NOT suing any of the 1.7 million Non Realtors( Real Estate Agents) Why?

Do you agree with or do you give cash rebates to home buyers or discounts to home sellers?

How do you think Realtors look in the public eye when they see the words (Anti Trust) when they see page after page of DOJ lawsuit information and the brochure that was published to open up competition for all, look at the MLS lawsuits alone from the DOJ.. come on!!! with all of this all over the news / net about Realtors really has harmed all Realtors reputations and will continue to do so when the outcome of it all is announced soon in the media.

What has being a NAR member Realtor done for you personally ?

This is all about the public best interest, not ours.

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