The XBroker: The End of The MLS As We Know It?

Very Exciting!  I'm going to check it out.....

I think it's a matter of time. Kind of like Good v Evil, Old v New.

I don't know how big of an impact this will be but ho's going to jump on board right away, who will wait while it builds momentum.

"X aka Jeff Corbett"

I just Group Featured this post. This is good stuff. :)

In light of what I have seen happen since my earlier days of sitting on the BOD for our local MLS  I see that it's time for MLS's to get off their high horses and give what belongs to Realtors back to Realtors.

If they don't the s**t is going to hit the fan. You know we are getting ready to wage a war with our local MLS. Someone has to stand up and say "Hey, what the hell is wrong with you people?"

I kinda volunteered for that job. :)

I have just finished two days of research and discovered that in many States the local MLS's are not abiding by rules put forth by NAR! How bad is that anyway?

I may be a little off topic but I need to speak up or forever hold my peace. I am not real good at holding my peace. :)

Yah. You may have touched a nerve with me here. :)

TLW "The Lovely Wife"...The Sherman Anti Trust Laws Come To Mind On This Topic. Giddy Up...ROAR!

Jeff,

You are right about the deep ocean tsunami.  It's easy to ignore it right now because most people have never heard of Zillow yet.  But I looked at their site and uploaded my five listings to it this morning and it is really a neat system.  It's very easy to upload pictures and I love the the mapping features.

I can easily see this becoming the go to place for searching for homes.  More clients will insist that their home be listed there, if not it will be very easy for the seller to place it there themselves. 

The neat thing about it is it will have both FSBO's and Realtor listings all in one place.

Realtors who list homes will have to be more like home selling coaches who make all the parts come together rather than marketing their value as the key to getting exposure on the marketplace. Have you seen those Ebay stores they have now? For those who aren't techniquely inclined, you take your stuff in and they get it up on ebay for you.  I see something similiar developing here. 

The one key thing that Realtors can provide is the lockbox system.  I can't imagine a method that can provide the same convenience with the same control and accountability.  But I'm sure someone will eventually come up with something.

I don't see buyer's agents affected too much because many people already have access to listing information and do all the searching themselves before they call an agent.  Local neighborhood knowledge and good negotiating skills will still be of value to many buyers.

The challenge I see coming though is FSBO's refusing to pay a buyer agents commission. Right now it's easy because the listing agent gets to deal with the commission negotiations.  Right now the only reason you can say that working with a buyer's agent is free is because of the way the listing agreement is set up.  With more  FSBO's we'll have to get good at getting the buyer comfortable with paying us directly. The buyer already does pay everything in the transaction anyway.  They are the only people bringing money to the table.  We have just figured out a way to make it look like the seller actually pays for some things. 

It should be interesting.  I just want to stay a few steps ahead of the game to figure out where I need to position myself.

Tim I love it when you come in and comment. I learn so much from you. :) TLW...ROAR!

Thank Tim...

I have seen the eBay site...who I think is another player in this growing line of early movers. 

I think there are two important factors to noodle on:

1) Its not just Zillow thats in play here, strip the name and its a highly ranked (page traffic) and sticky (keeps you there or coming back) site that is using 'off the shelf' and (relatively) inexpensive technologies to substantially enhance user experience. 

In other words, there are alot of small size service providers, including Realtors, who can replicate and capitalize on this from a local market standpoint.  

2)  This 'technology' is very disruptive to buyers agents, as it mitigates their need and thus expense.  The easier it is for a consumer to locate and research property, the less they see a need for full buyer representation and compensation.  Instead of allowing them to search different means all together, it would make sense for a Realtor to adjust to this growing nice of borrowers by altering their traditional 3% request. 

In my travels through the blogosphere, there is a growing 'interest?' in buyers negotiating the Buyers agent fee, prior to engagement..im a proponent of a version of this agreement.  Greg at the Bloodhound Blog presents the basis to this argument here.  

In the end, this isn't the end of the "Realtor", there will always be a need for a good pro in the middle of the transaction to quarterback the 'deal' aspects.

Whats appealing about these 'market evolutions', is that traditional top producers can further their success (which is only right), while the small to mid size producer also has an equal shot at reaping huge rewards.  

In the end, it'll be the agents who ignore or refuse to consider such change that will die in the inevitable war of attrition.

Watch the embedded Alexa Chart....you can begin to see the traffic spike from yesterdays announcement.

 

You cannot ignore that type of response...

X

Help me. What am I looking for. Treat me like your student. You know you're The Master. :)

TLW...ROAR!

Don't count your chickens yet.

In this market all the larger real estate offer their IDX feeds to the public. People can already go search all the listings for the big three brokers in New Orleans plus realtor.com. Several agents offer this too but you cannot find thier sites. The new ideas take a while to filter to middle america and by then things have changed. They are publishing data online which is what listings are. Our market is very tough since there are few subdivisions as most of you guys have in your area. It gets very hard to value even if you know a lot. You as a realtor need to think ahead of these guys and have nible fingers to get to the next step.

A fancy website, nor even the MLS can negotiate or keep deals together. Owners and buyers are way too emtionally involved and I believe zillow will continue to service that niche they have created. I see most people going to zillow to get comps. I tried it myself, what i couldn't understand was why zillow said my home was worth one amout yet all the comps had sold for 45k less? This will just wind up being another tool a realtor can use to market a home. Down the road I see zillow going sign-up realtors to be able to 'enhance' listings for a fee. 

Oh my oh my!  Jeff Corbett you've done it again.  Your article here is dead on except for the conclusion:

The writing is more than just on the wall…its the end of the MLS as we know it...and thats not such a bad thing :)

I might argue that Zillow is practicing the same seduction with ulterior motives that Microsoft did when they partnered for realtor.com.  I'm no Luddite but I know a disintermediation approach when I see one.

Realtors: They (the Zillow's of the world) will tell you its progress but it's a carefully crafted scheme to profit off of your hard work and minimize your existience.!

Jeff:

You comment (sixth up from mine) offers a nice alternative; creating a "sticky" site yourself (as a Realtor, a local MLS board, a state board, etc.) .  It's not the technology I caution against, it's the provider

Brian... a Luddite you may well be!

Noel...I believe ZIllow is far from done too...is this a Trojan Horse?  Their values and listings are sure to be far from dead on accurate...I cant help but see, as Brian says, a serious disintermediation, disruptive technology play. 

TLW...My servant is my master ;)

Eric...the NAR's IDX policy is about to change (more open access to information), or be drug into court by the DOJ, who is closer by the day to slapping down an anti-trust suit...

David...I see alot of eggs, but no chickens yet :)

HERE is an article from Zillow, regarding how to negotiate with a listing agent. Although it attempts to kind of be pro-Realtor, it has a lot of underhanded comments, like...
"...it's not unreasonable to request a discount of 1-2 percent on the commission. On a $400,000 home, that puts an extra $4,000-$8,000 in your pocket."

All that said - I am not mad at Zillow- or whoever, for that matter. It is competition like this that will force good agents to become better and so-so agents to get a new job. I just wrote a post about how I do not really understand WHY everyone is so riled up about this.

We (real estate agents) have been complacent in our industry for too long and that has made us incredibly vulnerable to new competition. This IS the new competiton - are we going to cry? or are we going to earnestly compete and win? I choose the latter.

Mariana...Well said, passionate!

I do think Realtors have been too complacent and content with the current system...

As I mentioned above, Realtors would be best served to identify ways to utilize platforms like the one Zillow is offering by adapting their own business with some similar tools and resources.      

Victory Through Surrender. :) 

Folks that remark had nothing to do with the topic of this post. :)

TLW...ROAR!

Hey Jeff C.,..   as much as this actually sounds like the step in the right direction towards real estate,it still won't offer that personal touch that a good realtor would bring to his or her client. Competition is great.... but if the client still doesn'ttruly understand how the system works,all they want to look at is the savings. And Zillow can offer that in several different capacities. But my question to everyone, does that still help out the client in the long run?

There is more to it than just ending the MLS.  It goes back to an operating system. Kristal Kraft wrote a great blog explaining this so-called match up.  And Jeff,I am not stating that this is a bad blog. It's actually well written with some great insight.

I guess the overall thing is not so much showing houses online. You just don't buy online,for the most part.  And that aspect of it will never happen. I will agree.... the MLS is not always accurate,but who is to say that Zillow will be accurate?  There property search for values of homes is not accurate.Sure,it works for some, but that is why you have appraisers. Hence the reason why you will have realtors. And Zillow can try to cut into their commissions, but there is more to it than that.

Last... in one of your comments, you did mention that there will always be a need for a realtor to quarterback a deal. But it goes back to the old philosophy..... cut the commissions down far enough, and you will leave the service aspect of what a good realtor brings to the table. Or the Broker Bryant's of the world,that can keep a deal together. This could be lost in many cases. Just my 2 cents. 

As I mentioned above, Realtors would be best served to identify ways to utilize platforms like the one Zillow is offering by adapting their own business with some similar tools and resources.

I couldn't agree more. Lenders could actually lead the charge on this one, locally, by creating such a site with participation from Realtors.  There are three reasons why people want to know the value of their home:

1- They're curious.

2- They want to refinance.

3- They want to sell.

Lenders win with 2 out of those three scenarios. 

The post comes down to Realtor.com or Zillow.com, if you're a Realtor where do you post your listings and why?  Which a good post topic all by itself....

  

HI Jeff, To answer your question. My listings go on Realtom.com automatically within about 48 hours of placing them in the MLS. I have never had a transaction from Realtor.com in 12 years. Fact is at this time the majority of buyers use Realtors to purchase a home no matter where they found the property on the Internet. They find the property, they call the Realtor and the Realtors search the MLS.  

• The MLS guarantees the Realtor they will be paid. Zillow cannot do this.
• Realtors monitor the MLS and report listings that have been sold or taken off the market so that the majority of the info is up to date and accurate. Zillow cannot do this.
• The majority of the participants of the MLS are bound by the Realtor's code of ethics. Zillow does not offer this.
• I can give a seller an estimate of value withing a couple of thousand dollars. Zillow has a "zestimate" that is not even close.
• I can help my preforeclosure seller negotiate a short sell. Zillow cannot do this.

To me, Zillow is not a threat and has absolutely nothing to offer me at this time. They do have pretty maps and aerial photos though:)

 

Bryant,  so you wouldn't use Zillows service as an extension of your current 'listing advertising' practices?  Just trying to gauge your feelings :) 

Jeff, My listings sell because they are priced right. I don't advertise my listings at all. All of my selling is done at the listing table. I am successful because I am an expert at pricing and convincing sellers to do the things they need to do to have their property ready to go on the market. I'm not sure what the stats are but I believe it's at least 85% of homes that sell through the MLS. Because of that I spend my time and efforts getting other Realtors to show my listings. Realtors in my area know they can depend on my listings being priced right, clean and easy to show. They also know I am easy to work with and that I will help them do the deal if they are having difficulties because they are new to the business or whatever. My peers want to work with me and they want to show my listings. And because of Range Pricing my listings will show up on searches more often.

Realtors advertise listings to appease sellers and attract buyers so they can sell them another property in most cases. Well I don't work with buyers and my sellers are appeased because I sell their property. All of my listings sell.

My biz plan is very very simple but effective. I market for Realtors not buyers. An example of how this works is ActiveRain. Do you think if given the opportunity, a member of AR would WANT to show and sell my listings?   

Bryant...thx for the insight...the best biz plans are often the simple ones... I want to show your listings :)

Bryant...How would you feel if your local MLS disengaged from Realtor.com and affiliated with a localized 'Zillow like' marketing provider as it's new advertising medium?  

Have you seen Redfin.com yet? 

 

 

While he types here is our 12 year old biz plan. We still practice this plan. :) TLW...ROAR!

Jeff, I'm not a fan of Realtor.com. Being as how all of my listings are "exclusive right to sell" I get paid no matter who sells my listing. I have been to Redfin.com. I know I probably should but I really don't pay to much attention to these companies. Since I am strictly a listing Realtor, I control the inventory and the commissions. I really can't see these biz models affecting what I do.

With the exception that Zillow offers a lot of info on how to "deal" with a listing agent ... I agree - these new business models will have more of an effect on the Buyer Agents out there. Good point...

Ditto. Jeff I think we are like this because we dominate our farm area. ROAR. Over the years using that biz plan I showed you works. It is so straight forward and simple. That we know we need to just stick with what works for us. We may have a twitch with MLS. But that will be resolved mush quicker than we expected. The way we do  things has left us somewhat naive on these other avenues of advertising. We our pretty far out of the box. Just have had no use for them. We sell our homes to our customers who are the Realtors in our area. :) Nice little niche we created for ourselves. :) TLW...ROAR!

Very Nice TLW and BB....

Im loving the feedback..as it helps me learn...Im not 'in the game enough' to know, so all this is helpful for me :)  I can see where being an exclusive listing agent and marketing to other Realtors is a win-win for you guys..

Reason I mentioned Redfin, is that a local (Seattle) MLS dropped Realtor.com and (I think, strictly my opinion) that they are going to pick up Redfin as the new place they (the MLS) puts their affiliated listings...

While this is a ways from burning its way through America, I like to watch these new strategies as they come out of the box...and yes Mariana, I think it is the buyers agent who bears the immediate brunt of such new 'search friendly' data rich interfaces....

 

Jeff,

Although there have been numerous posts on AR about Zillow, it has not been in my area (RI) until just recently. I read this post last night and did not want to comment until I researched Zillow myself. So maybe I am late to the table, (Rhode Island has a habit of that) but nonetheless here our my intial views.

• To answer your question, as BB mentions above, when we list in MLS it automatically gets picked up by Realtor.Com so it is not really a concern at this point if we belong (which we do) to NAR.
• I would definitely list a home in Zillow, as I would Craigs list and any other site available to me to best serve my customer. To me it would not be a question of "either/or"
• My concern with Zillow is the Zestimate. Because I am extremely familiar with my market, I was appalled at the conflicting and inaccurate data, not for myself but for the GENERAL PUBLIC, who will not know that many of the figures are wrong. They will not search, as I did, to see that there is a 2% accuracy in Rhode Island - stated by Zillow themselves!
• I know this is not your question, however, I see Zillow as a problem because people tend to believe what they read!

Okay, I could go on, but will try to stick to your initial question,

I am going to do some Redfin research...It would help me to learn...I am not in the picture enough. :)

I must see them coming out of that box. :) I'll return with what I think.

Hi Karen. :) TLW...ROAR!

I listed a property I own on Zillow.  I'll let you know how it goes.

Great points Jeff and Bryant had a right on statement about Realtor.com .  We're worth a lot to them and they don't have much without us... 

 

Oh Jessica - not succumbing to the dreaded Zillow already doll?  I'd love to hear an update and your take on the effectiveness - please keep us posted.  An evolution is long overdue. 

I know of some agents who still use the MLS books - can you imagine? 

EVOLUTION... what a concept!

Jeff C.:

A quick comment.  I understood your post after I read it 2-3 times.  I might point out that you sometimes use "online marketing industry" jargon that is difficult for us mortals to comprehend.

As usual, this is an excellent post (the third time I read it).  A suggestion and not a slight. 

A suggestion well taken Brian :)

I ran our last sales meeting, and found that although many of our agents knew about Zillow - they really did not know what it was about, really. I had the opportunity to tell them some of the details. I also made a great effort NOT to down talk it OR promote it. I gave some facts as well as some of the different opinions that I have heard about it, here in AR. Although peer opinions are invaluable, I honestly believe that each agent needs to form an opinion on Zillow ...et al, based on their own research, rather than the opinions of others.

I like that someone brought up eBay, because I have said for a while now, in several blogs and otherwise, that they are the hidden giant here if they ever wake up and figure out how to really morph into real estate.  As I noted yesterday, the NAR and MLS companies are going to lose unless someone knocks them upside the head and wakes them up to the market reality.  I didn't have your nice graph, but it's very interesting that after all this time Zillow so quickly got to a higher viewer count than REALTOR.com.