MLS Future PAG

MLS Future PAG

At the 2006 Annual Convention and Trade Expo, the NAR Board of Directors received the Presidential Advisory Group report and directed that it be provided to the appropriate commmittees and forums for discussion.


Report and Recommendations

of the

MLS Future Presidential Advisory Group

October 2006

Background and Charge

The Future of MLS Presidential Advisory Group (“PAG”) was appointed by National Association of REALTORS® President Tom Stevens. The PAG was chaired by REALTOR® Gary Thomas (CA). The other members were Doug Ayers (IL), Ann Bailey (CA), Shannon O’Brien Calvert (MO), David Charron (MD), Jim Duncan (VA), Merilynn Foss (MT), Bob Golden (CO), Jim Harrison (CA), Jim Helsel (PA), Tom Innes (VA), Mike Jewell (MA), Kevin King (WI), Gregg Larson (AZ), Bill Malkasian (WI), and Greg Zadel (CO). NAR staff support was provided by Laurie Janik and Cliff Niersbach.

The PAG was charged by NAR Leadership:

To develop a vision for the future of MLS based on the assumption that no current structure exists and that no barriers exist for its design and implementation.

NAR Leadership supplemented the charge with the following key issues to be examined/considered as part of the PAG’s deliberations.

    • Is the current concept/structure of MLS correct? If not, how should it change, i.e., ownership, aggregation, etc.?

    • Can/should efforts be made to distinguish MLS (viewed as the mechanism brokers use to enter into cooperative relationships) from real property ad aggregations (that can appear similar to MLS compilations). If yes, how can that be accomplished in the eyes of the members? Consumers? Regulators? MLS participants?

    • Can/should sentiment for “public MLS” or “public access to MLS” be addressed in a positive way that addresses the needs of brokers and the needs of sellers and buyers?

    • Is there “room” in MLS for FSBOs (unlisted property where the seller is willing to pay a commission to the broker finding the buyer)? For FSBOs that are ads intended for potential buyers?

    • What are the practical, technical and license law implications of a newly envisioned MLS structure/system?

    • Are MLSs organized/administered to ensure they are responsive to participants’ needs (e.g. supporting standard data feeds to members to encourage development products by outside vendors that assist brokers in their business)? If not, how should they be changed?

    • What is causing the movement toward broker–owned MLSs? Monetary considerations? Lack of regionalization? Need to comply with mandatory NAR policies? Other?

    • What future service opportunities exist for MLSs (e.g., offering access to public records or offering transaction platforms)?

    • What security and privacy issues need to be understood to enable additional uses of the MLS content to the benefit of the members? (e.g., tagging each property with a unique identifier to enable electronic transactions).

In the course of its research and deliberations, the PAG received and reviewed resources including the 2006 MLS Technology Survey (Center for REALTOR® Technology), key provisions of NAR’s current MLS policies, MLS-related articles and news stories, the Code of Ethics and Standards of Practice, excerpts from the findings of the Connect 2006 Workshop, The Consumer: Catalyst of Change (Association Executives Committee Strategic Issues Work Group), MLS Working Group Statement of Principles (California Association of REALTORS®), Discussion Paper: Future of MLS (Pranix, Inc.), 2005 Profile of Home Buyers and Sellers (National Association of REALTORS®), and Internet Vs. Traditional Buyer (California Association of REALTORS®).

In addition, the PAG conducted in-person, in-depth interviews with key industry participants and others including Mike Long (Move.com), Mark Lesswing (Center for REALTOR® Technology), Ann Bailey (Pranix, Inc.), Pete Flint (Trulia), Michael Adelberg (Google), Ken MacKenzie (MLS.ca) and a panel of “twentysomething” REALTORS® Jennifer Evans, Karl Whittenbarger and T.J. Veneris.

At the outset of its deliberations, the PAG decided to bifurcate its task, first developing the vision of a property information system serving the needs of real estate professionals in the future (informally referred to by the PAG as the "professional side"); then turning to those aspects of the resulting system that might address the needs of consumers (the "public side"). The recommendations that follow immediately below relate to the vision statement, principles and characteristics of the proposed property information system that will best serve the needs of real estate professionals in the future.

 

Recommendations addressing the “Professional Side” of MLS

Vision of the MLS of the Future

The “MLS” of the future will be the gateway to real property information for real estate industry professionals.

Defining principles and characteristics

Services provided to real estate industry professionals

    • Current and historical data about all real property will be immediately and easily available directly from the gateway or through participants’ service provider of choice.

      • Properties available for purchase, lease or exchange will be “flagged” according to status (with the owner’s or principal’s consent). Properties listed with brokers will be distinguished from unlisted properties on the market (“FSBOs”).


      • In the initial stages the gateway’s database will include information about all real property in the U.S.


      • Ultimately the gateway will provide information about real property worldwide.


      • The gateway will facilitate multi-lingual access to real property information.

    • Information available to participants and subscribers will be:

      • comprehensive


      • timely


      • relevant


      • accurate


      • objective


      • secure


      • formatted so it can be annotated, supplemented or corrected by other participants or subscribers whose contributions will be acknowledged and electronically “fingerprinted”


      • consist of “official” information (i.e., data available from recognized authoritative sources); “factual content” (i.e., data and comments provided by listing brokers); and enhancements and corrections offered by other participants and subscribers


      • information enhancements, updates and corrections made by others will be performed on identical platforms


      • participants and subscribers will be able to provide direct, immediate feedback to listing brokers

    • Service providers will offer participants access, value-added tools, and other enhancements to real property information, at prices determined by the service provider. Participants will be able to choose whether they will input / access real property information directly through the gateway or through the service provider of their choice.

    • Participants will cooperate with each other in the manner anticipated by Article 3 of the Code of Ethics.

    • Participants will have the opportunity to offer compensation for cooperative services. Offers of compensation, if any, can be customized.

    • Access to information will be subject to participants agreeing to arbitrate contractual disputes with other participants.

    • Participants will be able to register their buyer-clients, including their real property search criteria.

Participation and access

    • Participants will be real estate broker-principals, firms comprised of real estate broker-principals, licensed and certified real estate appraisers, real estate appraisal firms, and property management firms.

    • Subscribers will be non-principal brokers, sales licensees, and licensed and certified real estate appraisers affiliated with MLS participants and may, as a matter of local option, also include participants’ affiliated unlicensed administrative and clerical staff, personal assistants, and individuals seeking licensure or certification as real estate appraisers, provided that any such individual is under the direct supervision of an MLS participant or a participant’s licensed designee.

    • Vendors authorized by participants to develop/deliver enhanced data products to those participants will have access subject to appropriate license agreements.

Operational issues

    • The gateway will be a participant-owned cooperative governed by real estate broker-principals. It will not pay dividends. It will not subsidize or underwrite unrelated activities or operations, including associations of REALTORS

    ® at any level.

    • The gateway will exist for the benefit of the community of real estate professionals.

    • There will be a standardized data structure which can incorporate local customization and content.

    • The gateway will employ streamlined, consistent business rules applied on a universal basis.

    • The gateway will have authority to contract with local and regional service providers for administrative services (e.g. arbitration, rules enforcement, billing, training, technical support, and other functions).

Implications for Existing MLSs

    • The gateway will be a data repository supporting multiple service providers’ front end user interfaces, including the gateway’s interface

    • Service providers will establish / enforce rules consistent with the business rules established by the gateway.

    • Existing MLSs will be encouraged, but will not be required to, participate in the gateway.

    • Participating MLSs / service providers will supply data (including listing information) to the gateway and may provide front-end, value-added tools, and other enhancements.

(10.25.06, rev10.30.06, rev11.8.06)

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