The Death of the MLS

By
Real Estate Agent with McGraw Realtors
http://actvra.in/4SMD

Searching for a house to buyHer name is Susie Anybody.  She lives somewhere in the US.  And she's looking for a house to buy in the town where she and her family will be moving to.

After a quick search, she's got 4-5 houses lined up to see next weekend with an agent she found online.

Sounds typical right?  Except that it isn't.  Because in this situation, Susie Anybody will buy a house she has found online, probably from the big Z.  And it will never be listed in the MLS because there won't be an MLS.

And right now you are saying, "WAIT...what?  No MLS?  How can this be?"

Maybe you are shaking your head right now and you're saying, "It will never happen.  It can't happen."

Perhaps you are thinking, "Hmmm.  Interesting...perhaps?"

And others are with me.  Because you see it.  And you know it's coming.

Yep, it's the death of the MLS.  And it's coming.  Soon.

Why is this going to happen?

1. First, because the Z people are disruption people.  We live in a disruption society.  Ever used Uber?  You're part of a disruption cycle.  My wife and I Ubered all around Seattle one weekend and loved the service.  We walked right by taxi's and never thought a second about the poor guy sitting there hoping to take us somewhere.  How ironic that we were disrupting in the very city where our disruption is taking place.  Disagree?  Think I'm all wet?  I'm not and here's why.  The Z folks aren't up to anything sinister.  They're just building a better mousetrap.  It's what smart companies do to build their brand, make a living and continue the growth and change of society.  It is normal, natural and expected.  And in this case, they beat us at our own game.  Shame on us.  Shame on NAR.

2. This is going to happen also because we don't need the MLS any longer.  Think about it.  What do you have to do to put a property into the MLS?  You have to pay money.  You have to follow rules.  You can't say certain words and phrases because of regulations and rules.  Pictures have to follow a certain format and once you upload them, they're not yours any longer.  Now they belong to your broker and to the world because your pics are now online EVERYWHERE.  In the MLS, you have certain time frames you have to follow to get a house pending or sold or removed if it goes off the market.  And you can be fined for not following the rules.

I was thinking about this last week and specifically about my frustrations with the MLS (like how long it takes to get info into the MLS because we do not have add/edit rights).  With the big Z, uploaded info is instantaneous.  And easily fixable.  A couple of weeks ago, I listed a property into the MLS which then fed to Z and the other portals.  I noticed that Z still had the previous listing info so I sent them an email about it. Within minutes the old listing was gone and the new one was sitting there nicely in it's place with my pics.  

And where is a buyer going to find that listing?  Yep, on the Z.  What if it wasn't in the MLS and only on the Z?  It's still going to be found.  And found easily.  In short, I could only put properties on the big Z and still sell houses.  This is going to happen because it already is.  Think about it.  How many FSBO's do you show your buyers?  Lots right? And where did they find them?  Not in your MLS.  They found them on the Z site.  

But what about accurate data for listing prices?  I'm not sure how that will work out, but I do know this.  Z doesn't care.  At least not much.  That's why their estimates are off.  Because it doesn't matter.  It's a conversation starter.  So when Joe Homeowner wants to sell his house he already has an idea of pricing.  Maybe someone will make a website that has closed pricing data.  Maybe the industry changes and buyers and sellers just get to where they change the contract price once the appraisal is in.  Or maybe the appraisal happens first and then contract.  It really doesn't matter how it develops because this part will work itself out.

Last year one of our discount brokerages quit putting properties on the MLS and only put them on Zillow.  It's coming folks.  And it's too late to stop it.

Still don't agree?  You might want to check out this little article from Inman that was posted today.


Inman article about free MLS

So what does this mean for our industry?

  • It means change.

The days of listing agents is going away.  Soon, there won't be any listing agents because there just won't be a need for us any longer.  Consumers will upload their info online, post pics and buyers will choose properties to view.  You and I will get to show those properties based on getting selected by the buyer...or not and based on if we are an option agent on the property or not.

  • It means a national listing site is being born and it isn't the MLS.

It's going to be the big Z or some other online portal.  You and I won't have to pay MLS dues or fines or any of that stuff any longer.  But we will still have to pay.  Just like we do now.  We will have to pay to get to be visible to buyers.  And we may have to pay dearly.  Being not licensed and unregulated, the Z folks can set their own fee structure.  And they have no rules they have to follow...

  • It also means you will do more work for less pay.

We will soon be agents for both buyers and sellers.  And you are saying right now, "Well I do that sometimes already."  And I say to you, "Yes," but not for only 2-3%...or possibly 1%!"  Be not fooled.  This is what is coming.  We will work for both sides at less commission.  It is coming.

Can it be stopped?

That's really the question isn't it?  My short answer is no I don't think so...unless...

Unless we can change the definition of how property is sold to include anyone who is involved in the marketing and connecting together of buyers, sellers and agents.  If we could change the definition (which means changing the law) we might have a fighting chance.

Or not.

Because Z could just decide to get their Broker's license.  And if that were to happen I would still have to say...

Get ready.  It's coming.  Change is coming.

Posted by

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Bob Haywood
Bob Haywood
Owasso, Oklahoma REALTOR®

Tulsa, OK REALTOR®/ McGraw REALTORS®
Bhaywood@mcgrawrealtors.com
(918) 272-7272

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Re-Blogged 3 times:

Re-Blogged By Re-Blogged At
  1. Ginger Harper 06/27/2016 06:42 AM
  2. Ken Jones 06/27/2016 10:46 PM
  3. Eileen Burns 06/28/2016 12:35 AM
Topic:
Real Estate Industry
Tags:
mls
zillow
zestimates

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Rainer
449,552
Richard Bazinet /MBA, CRS, ABR
AZuRE Team - Realty ONE Group - Scottsdale, AZ
Phoenix Scottsdale Real Estate

With all due respect, I'm not convinced at all by this gloom and doom argument - I just don't buy it. I don't think one technology replaces all the others as it tries to modify consumer behavior and I just don't see this happening anytime soon. We have seen similar in other industries in a lot of other ways if you observe astutely, and quite the opposite happened.

Jun 29, 2016 12:23 AM #140
Rainmaker
502,513
Mike McCann - Nebraska Farm Land Broker
Mike McCann - Broker, Farmland Broker-Auctioneer Serving Rural Nebraska - Kearney, NE
Farm Land For Sale 308-627-3700 or 800-241-3940

I am not convinced that the MLS is going away...but it should be changed...a lot.

I have not belonged to the MLS for over 7 years and yet make a nice 6 figure income. I cooperate when necessary on commission.  I do not play the games of the local MLS because they are not to the advantage of my clients.

I also do not list houses.  In fact...the majority of the largest income producing agents and Brokers in Nebraska do not belong to any MLS. In its current form it is not of value to them (me).  Oh I know...the major powerhouse brokers will put me down...but the truth will set you free.

One other truth...ZIllow sucks. They list my house as valued at $249K and today I could sell it for $370,000.  The majority of the public is becoming aware of how poor zillow is...and I think agents need to quit worrying about it.

Just the simple truth. 

Jun 29, 2016 12:52 AM #141
Anonymous
dixie harrison

I think it's sad when the client or customer has more free access to properties on line where I have to be a member of a MLS or search like a client myself. I say we need one MLS across the board for everyone or one time access payable fee to a non-member who needs info on a certain property in a MLS in which he is not a member.

Jun 29, 2016 01:20 AM #142
Anonymous
Dianne Meyer

I personally don't believe there will ever be the death of the MLS, especially at the expense of the big Z. So what if buyers run to Zillow and find homes they want to see. It just makes our job a little easier. Zillow is a buyer tool and the MLS is an agent tool. They have 2 distinct different functions. The MLS is where agents go to find homes to show buyers with information that is accurate, more thorough and up to date. Not to mention search features. Can you use Zillow to search only short sale or bank owned homes? It is also the best tool for doing a market analysis when listing homes. Zillow can't compete on that level. If the day ever comes that I have to use only Zillow to find homes to show or rely on it for establishing the list price of a home because there is no longer an MLS, then I will get out of the business. As much as there are some frustrations and cost associated with the MLS, it still the core of our business as a real estate agent and I can't see how that can ever be eliminated or can be eliminated.

Jun 29, 2016 02:23 AM #143
Anonymous
John Kaye

As a retired Realtor of 45+ years in the industry, I detest the NAR and it's financial abuse of Realtors throughout the years I was active. The issue of the MLS going away should never happen for the sake of the consumer. The unscrupulous people in the R.E. industry are taking advantage of people in "Z" and will continue until such time they realize only a qualified Realtor can offer them protection from being ripped off.
Though the demise of the MLS may sound like a trend on the surface, it will need to morph into something else to continue offering protection to the masses. As a non-realtor I can consult people in their financial matters concerning Real Estate, but I won't. I tell them to talk to a Realtor.
I opted out of the Real Estate industry years ago to pursue REAL financial wealth. As an Entrepreneur I have no restrictions on how I help people to do the same.

Jun 29, 2016 03:14 AM #144
Rainmaker
664,662
Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

If NAR gets its Realtor.com site up running  right and block feeding listing through all MLS sites (owned by NAR) it may be able to make all thrid party sites useless. 

 

Jun 29, 2016 03:36 PM #145
Rainer
5,481
Stanley Ching
2020 International Real Estate - Pearl City, HI

How many REALTORS actually read, understand, and use all the information and knowledge that posted on the NAR's website? When we don't even take advantage of these cheap education and insights don't complaint !!

Don't forget our job as a listing agent is to promote the property so it can get a better return or faster sale. It's all about the Seller's Interest not ours. The MLS is not going anywhere as long as we have ethical REALTORS.

Next time if your prospected Seller want to compensate you with 1% commission you should show him how he can sell his property by his own. Give him a Seller's checklist.

Jun 29, 2016 05:01 PM #146
Anonymous
Kamil

Well here is my take on that disruption society people, only time will show the true effects. Realtors will have to show their true knowledge vs the big Z data that is not accurate as to values and MLS will always be there. As far as Uber goes I will not use it again as last time a beat up car showed up with bald tires going 70mph in Dallas... again only time will prove the results of non regulated "disruption society" method.

Jun 29, 2016 11:31 PM #147
Rainmaker
16,724
Darin and Mary Waldeck
SunState Realty - Englewood, FL
Exceeding Expectations!

https://www.change.org/p/national-association-of-realtors-petition-to-nar-to-stop-syndication-of-all-mls-listings?recruiter=82715275&utm_source=petitions_show_components_action_panel_wrapper&utm_medium=copylink

Jun 30, 2016 01:00 AM #148
Rainmaker
315,411
Liz Flint
Century 21 Hardee-Team Realty - Houston, TX
Houston\Tomball Realtor (832)816-8066

You said you emailed Zillow and they changed the listing within 15 minutes. What is the email address? Ty, Liz

Jun 30, 2016 02:24 AM #149
Rainmaker
511,824
Sheri Sperry - MCNE®
Coldwell Banker Residential Brokerage - Sedona, AZ
(928) 274-7355 ~ YOUR Solutions REALTOR®

I remember 100 years ago that dvds were going to be the death of movie theatres.  NOT!  In fact, the movie industry took advantage of that industry to make another distribution point for their movies.  The Music industry thought it was going to be doomed as well. They are adapting. 

I strongly believe we will adapt and be stronger for it. How many Realtors are there in the US? (plus everywhere else).  I embrace the future and want to ride the wave.  

Jun 30, 2016 06:00 AM #150
Rainmaker
294,720
Tammy Adams ~ Realtor / Podcaster
Maricopa Real Estate Co - Maricopa, AZ
A Maricopa Agent who Works, Lives & Loves Maricopa

Will Zillow kill MLS? Who knows. But I do believe that things will change.  

 

The uber example is great, who would have thought 5 years ago we would be hopping in strange peoples cars to get from point A to point B?

 

Someone will find a way to create a new mousetrap. The question becomes, will it be someone in our field or an outside source and will that mousetrap give folks a better way? 

 

I agree with a few folks above. Continue to offer the best customer service possible and you will stand out.  So many folks are hiding behind technology and it is hurting them. 

 

The right mix will involve both technology and service. We can kick and scream all we want. The buyers of the future will demand a technology based process since that is their world. 

 

We must be open minded and flexible.

 

A Head in the sand will not stop progress. 

Jun 30, 2016 09:43 AM #151
Rainmaker
8,566
William McIntosh
McIntosh International - , CA

Thanks for your thought provoking post Bob!

 

Reading through the comments above I don't see any mention of the role of the agent in negotiations? In my opinion this is still THE most important function and service we can offer both buyers and vendors. 

 

Yes it's true thanks to the internet we are no longer the sole custodians of data re solds, currently for sale etc. And thanks to the internet there will always be new and snazzy search engines for consumers to acquire all this information.

 

However... the one role that web portals, search engines, 'do-it-yourself' FSBO services etc cannot provide is the negotiation process. Part science/part art, the vast majority of buyers and sellers cannot perform this money making (or losing) service. Heck even I will not list and sell my own homes even though I'm a seasoned pro!  I lose all objective perspective and become swept up in the emotional roller coaster in the heat of the moment.

 

So. New search technology? Absolutely. But replacing a professional agent who will get the seller the highest and best price? Or the agent who gets her buyer the best deal possible? No way. 

 

see my very first featured post here

 

 

Jul 01, 2016 05:18 PM #152
Rainer
5,213
Damon McGruder
Onpoint Real Estate Services - Seattle, WA

I remember a time before the internet when we had all the listings in a big book that was delivered by the MLS every week (thus weekly sales meetings), and when the internet began to be the medium in which we marketed homes more than print media the doomers would say that was the end of real estate as we know it. WELL here we are 2 decades later and thriving! Bob, you did get one thing correct... change is inevitable and we'll weather this changing storm too.

Jul 02, 2016 12:59 AM #153
Rainmaker
130,279
Lesley Wilson-VanGoethem
Innovative Realty Solutions Group - Winter Springs, FL
Residential Real Estate Sales Specialist

Interesting thoughts.. change is inevitable, but not so sure it will be Z making the change..

 

Jul 04, 2016 01:28 AM #154
Rainmaker
151,253
Will Allen
Long Beach, CA
I deliver successful results,results that move you

Bob . . .   Unfortunately I agree with everything you said . . .  unfortunately The Big Z is moving towards being a brokerage...  they'll dictate splits, they'll match agents (when necessary) with Seller's or Buyers...  it's an interesting time to be in this business.

In the beginning I always thought the glut of online information gave the normal consumer just enough information to be dangerous.  They show less appreciation for what we bring to the table and I think it's hurt our industry.

Now I think the online information is getting better and the consumer is getting more sophisticated.  As you said, "They are building a better mousetrap"!

Nice piece . . .  I'm glad it's not just me. 

Jul 04, 2016 02:37 AM #155
Rainer
342,199
Anna Hatridge
Goodson Realty - Bonne Terre, MO
Missouri Realtor with Goodson Realty

I agree the market place is changing and we have to be ready to change our mindset if we want to stay in the market.

Jul 09, 2016 08:36 PM #156
Rainmaker
2,355,321
Evelyn Johnston
Friends & Neighbors Real Estate - Elkhart, IN
The People You Know, Like and Trust!

The real estate world as we know has slowly been changing for years, away from us. NAR has given the data away for money, until they correct their error, and update their methods of doing business, it is still heading away from us.

Jul 23, 2016 04:07 AM #157
Rainmaker
627,430
Mel Ahrens, MBA, Kelly Right Real Estate
Kelly Right Real Estate - Hood River, OR
Customized Choices for your Real Estate Needs

Bob,

You are correct - change is going to happen. Knowing it and reacting to it are not the same.  You mention working for less commission in the future. Why does the compensation system have to be commission based? Perhaps the compensation system needs to change too.  There are other ways to be compensated besides commission; ways which offer a reasonable return to the service provider and saves the consumer money.  The bigger issue is the consumer does not perceive value in the commission based system.  Zillow would not be disrupting the industry if the consumer was satisfied with the status quo.

Mel

Jul 28, 2016 04:33 AM #158
Rainmaker
63,853
Cody Carmen
Adhi Schools, LLC - Rancho Cucamonga, CA
Market Analysis--Educational Content, Adhi Schools

Very interesting post, thank you for taking the time to write it! I'm not sure what the future holds, but it will hold change. Adapt or become obsolete. It happens to every industry at some point. 

Aug 09, 2016 08:52 AM #159
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