The Phoenix Real Estate Guy » Real Estate

Sandicor Fires Another Round in the Listing Syndication War

Jay Thompson — Tue, 07 Feb 2012 23:27:45 +0000

OK, maybe “Listing Syndication War” is a little too sensationalistic.

Maybe.

There’s no question though that news about real estate listing syndication is now coming at a fast and furious pace.

Back in November, Edina Realty lobbed the first round when they announced they were pulling their listings from Trulia and Realtor.com

Then a couple of weeks ago it was Jim Abbott and ARG Abbott Realty Group in San Diego doing the same, and adding Zillow into the mix.

Yesterday Metrolist, the Denver, Colorado area MLS announced they were not renewing their contact with leading IDX supplier Diverse Solutions, which was recently acquired by Zillow.

And today brings the announcement that Sandicor, the San Diego area MLS is making significant changes to what they will be feeding listing syndication sites.

Take a moment to go read Lily Leung’s article in the San Diego Union Trbune Business section, San Diego MLS turns table on Zillow, Trulia.

Here are some highlights:

Sandicor, the county’s MLS, has added a text field to its listings that allows members to enter contact information, including names, email addresses and brokerage websites. The information, along with the usual listing data, would be disseminated by syndication websites such as ListHub and Point2 Agent, which are sources of information for popular real estate sites.

The main idea is that the contact information in the extra field would be displayed prominently for home hunters to see, nixing any confusion over the listing agent and an agent who is advertising on Trulia or Zillow.

Further…

Soon, the company will decrease the number of photos that can go out to syndicators to four, down from the maximum of 25. Another upcoming change: Images sent out to outside parties will bear watermarked contact information of the listing agents.

Well howdy doody! To my knowledge this this is the first time a Multiple Listing Service has taken steps to — what many will argue — take back some semblance of control over listing data.

Good move? Bad? Meh?

Must. Ponder. Implications. Further.

My immediate thought in reading what Sandicor was doing was, “Interesting!” Followed immediately by, “I wonder if other MLS’s will follow suit?”

It wouldn’t surprise me if they do.

Personally, and this is coming from someone who is obviously “pro syndication”, I like the idea. Or at least parts of it.

While I am not one to believe that we need to wrest all control and display of listing data away from third-party sites, I don’t see anything wrong with including additional information about the listing brokerage. BUT, if you are a home buyer, think about why you’d want to work with the home seller’s agent. The seller’s agent has THEIR best interest in mind, not yours. If you are buying a home, work with a buyer’s agent that will have YOUR best interests in mind..

Reducing the number of photos? Well, there is zero question in my mind that potential home buyers searching for home online like to see listing photos. Generally speaking, the more the merrier. (Though seriously people, it is quality not quantity that matters when it comes to photos. Maybe we could cease & desist uploading photos of toilets? Particularly those images with the seat up?) I’m speculating that Sandicor feels limiting the number of photos displayed on third party sites will drive those photo-seeking visitors back to the local agent/broker site (or, in the case of Sandicor and a handful of other MLS’s, to their public-facing MLS site).

Only time will tell how or if that pans out. Personally, I think it’s more likely to frustrate home searchers. Why make them hunt around for photos? Oh, that’s right. To capture them as a lead. ::sigh::

In the mean time, it is going to be very interesting to see if other MLS’s step forward and make an effort to better highlight the listing agent on third party sites, how this additional info (along with fewer photos) might impact the sale of advertising on third party sites, and what the next salvo will be that is fired in the Syndication War.

What are your thoughts?

More info: Sandicor’s formal announcement.

Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader, the site you are on is guilty of stealing content.

Mortgage Tech Summit Comes to Scottsdale Feb 9 & 10!

Jay Thompson — Mon, 06 Feb 2012 19:21:30 +0000

If you are in the mortgage business and near Scottsdale, AZ then you should already be registered and have this on your calendar.

Why?

Because where else are you going to get two days jam-packed with info to help your business?

If you are a real estate agent or broker, you should strongly consider attending the Mortgage Tech Summit.

Why?

Because as a real estate agent, it is crucial for you to understand how those crazy mortgage people do business. After all, like them or not, mortgage people are fundamental to getting your real estate transactions closed.

Besides, just take a look at the schedule. Much of the discussions happening could be easily used in the real estate sales business with some very minor tweaking. Seeing how other groups of businesses — not just those in real estate sales — go about marketing, using their database, and applying tools to prospecting can be a valuable learning experience.

The “MTS” starts Thursday. Be there…

What: Mortgage Tech Summit
When: February 9 and 10, 2012
Where: Arizona School of Real Estate & Business. 7142 E. 1st Street, Scottsdale, AZ 85251.

Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader, the site you are on is guilty of stealing content.

On the “Value Add” of a Real Estate Agent

Jay Thompson — Fri, 03 Feb 2012 21:20:28 +0000

As the kerfuffle over a San Diego real estate broker pulling their listings from syndication sites is about to enter its second week, I keep seeing something reiterated over and over. I’ve seen it stated in many different ways, but it all boils down to “listing data”. How important, many say critical, that data is. Well, not the data itself necessarily, rather it is the control of that data (or lack thereof) that seems to get so many riled up. Here’s a paraphrase of the argument:

Our listing data is our lifeblood. Listings are the most valuable thing we have to offer the real estate consumer. We’ve got to stop giving our data away!

Really?

If you think listing data is all you have to offer the real estate consumer, then I have to respectfully suggest you find another line of work.

“Listing data” is the most valuable thing you have to offer? A pile of photos, some cheesy sales copy (Honey, stop the car!) and a list of amenities is all you have to offer?

We (“we” as in the real estate collective) lost control of listing data long ago. Gone are the days when the only way a potential home buyer could find out what homes were for sale was to go to a real estate broker’s office and flip through printouts in a three-ring binder. Gone are the days when every open house was printed in the Sunday paper. Gone are the days where agents and brokers were the only people with direct access to listing data.

Gone. Thank God.

This whole, “We own this valuable data and shouldn’t be giving it away for free” argument is ridiculous.

First of all, I think I could make a passable argument that the homeowner is the one who provides and owns the data. (Yes, I am fully aware that contractually the broker owns the data and the right to sell the home. But for Pete’s sake, it is the client’s home we are talking about.)

That argument aside, the last time I checked, I am not paid to sell photos, or descriptive sales copy, or a floor plan, or a video of a walk-through. I am paid to sell a home. All that other stuff – all that data – is marketing material.

“Listing data” in and of itself isn’t worth a plug nickel. Listing data is a means to an end. It is there to sell a home. As I mentioned in an earlier post, On Compensation for Listing Data, I’m OK with the commissions I receive from selling a home being full compensation for my listing data.

And I think you should be too. But that’s just my opinion.

So if it’s not the data, what is our “Value Add” in a real estate transaction?

Listing data is ubiquitous, like it or not. The cat is out of the bag. The toothpaste is out of the tube. The ship has sailed. Whatever lousy metaphor you want to use, the simple fact is listing data is out there, we don’t control it. We can’t control it.

Welcome to the 21st century.

Maybe long ago in a galaxy far far away real estate brokers held and controlled the listing data with an iron fist. Maybe back then that was all they added to a real estate transaction. I’ve only been in real estate since 2004, well into the “internet age”. I’ve never experienced being the sole gatekeeper of the golden data.

So perhaps what I think real estate agents bring (or should bring) to the transaction differs from your opinion. Maybe I am short-sighted. Naïve even. What I think I bring to the real estate transaction is pretty simple though.

I bring expertise, knowledge, experience and ability to facilitate the real estate transaction to successful closure.

In anything, it’s not the specific data that matters, it is how the data is interpreted and used that makes the difference.

Agents whine, often incessantly, about the “Zestimate” that Zillow generates – that being their estimate of a home’s value. The estimate is derived from public records data about recent sales, squeezed through some algorithm, and like magic some number is spit out the other end. Do consumers believe this number is a rock solid opinion of their homes value? I’m sure some do. It’s the real estate agents job to ADD VALUE by explaining to the consumer why that number may or may not be accurate. And you know what? Consumers are smart. They get it once you explain how it works. YOU are the real estate expert, not them, and not some piece of software.

Did the boys at Case-Shiller just publish some Home Price Index data that loudly proclaims, Home Prices Continued to Decline in November 2011? Yeah? And let me guess, your local newspaper picked up that headline and ran with it. Well, how about you ADD VALUE and actually interpret that data for your client. Point out the flaw in making national proclamations from very localized data. How about you ADD VALUE and run the numbers for your client for neighborhoods they are interested in rather than relying on metro-wide broad brushed strokes of data. You do understand the nuances and variations in neighborhood to neighborhood sales data, don’t you?

If you really want to ADD VALUE, maybe you should be telling that potential home buyer who is looking in Holliday Farms or Higley Groves that it is impossible to turn onto Cole Avenue between 7:30am and 8:00am Monday through Friday because of the horrific traffic flow around the elementary school. Maybe you can ADD VALUE by informing those south Gilbert buyers that while the stink of the Higley dairy farms is getting better, that they need to be aware that on cool nights with a southeast wind, they can expect the air to be filled with the scent of cow feces.

Know the neighborhoods. Understand and interpret the reams of data available to the public. Guide the client through the maze of forms, through the hoops, over the obstacles that present themselves in every real estate transaction. THAT is how you ADD VALUE. Way more value than what your marketing material disguised as “listing data” is worth.

We are making these third party sites the experts!

The corollary to the “we shouldn’t give our data away for free” argument seems to be that by doing this we are establishing these third party sites as the experts in real estate. If they have the data, then consumers will look to them as the experts.

Hogwash.

Once again, I think we are selling the intelligence level of the general public short. The day a web site takes over as the expert – in the place of human experience and intelligence – is still a long way off.

Back in 2006, the late great Joe Ferrara coined a term – Unzillowable. It represents all those things about real estate that a piece of software and an algorithm can never capture and consider – traffic noise, smells, the fact your neighbors have a 1963 pickup with no doors up on blocks in the front yard. The cat that jumps the fence to take a dump in your plants, the street light that shines in your bedroom window. The list is endless.

Software can’t “see” that sort of stuff. Listing data can’t define it. You, the kick-ass know-your-stuff real estate agent can ADD VALUE with that sort of information and more.

It’s your knowledge of the real estate transaction, and how to prevent it from falling apart, that ADDS VALUE. It’s the trust you build with your client that ADDS VALUE. Listing data doesn’t add value. YOU add value.

Don’t sell yourself short.

Photo Credit: Pillars of Influence. By David Armano on Flickr. CC Licensed.

Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader, the site you are on is guilty of stealing content.

On Compensation for Listing Data

Jay Thompson — Sun, 29 Jan 2012 18:11:52 +0000

I’ve read (and participated in) many discussions about ARG Abbott Realty Group pulling their listings from national syndication sites over the past 24 hours.

A recurring theme keeps coming up.

It is another point the “anti-syndication” crowd tends to rally around, and another point I don’t understand.

“Agents and brokers deserve compensation for their listing data.”

“In the information age, Agent’s listings data are Valuable, and they need compensation for it.”

“That listing data is valuable. They should pay us for it!”

Syndication sites take listing data “without compensation to the brokers, agents, photographers and videographers who create, pay for and own the content.”

So it seems there are many out there that feel we should be compensated for our listing data.

Uhm, we are compensated.

It’s called a commission check.

You know, that payment you get from your home selling client when you do what you were hired to do — sell their home.

Some of those commission checks can be rather substantial.

But you want additional compensation for your listing data?

Plan to share that additional compensation with your client? You know the one who really, if you think about it, should “own the data” from their own home.

Good grief.

This ought to play out well with the general public — that group of people that buy and sell homes. That group of people that become your clients. A significant percentage of that general public thinks all real estate agents are blithering idiots. Smarmy sales people. Money grubbers.

And now you want “additional compensation” for listing data.

::Sigh:: It’s no wonder this profession has a big giant scarlet letter ‘A’ tattooed across our collective foreheads.

Here’s an idea.

Do your job. Sell your client’s home. Smile and thank them profusely when you get your compensation.

And stop being greedy.

Photo Credit: What Lies Behind. By Truthout.org on Flickr. CC Licensed.

Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader, the site you are on is guilty of stealing content.

ARG Abbott Realty Group Pulls Listings from Zillow, Trulia and Realtor.com

Jay Thompson — Sat, 28 Jan 2012 19:32:40 +0000

The real estate interwebs blew up last night when the announcement from San Diego based real estate brokerage Abbott Realty Group (ARG) came down that they were going to stop syndicating their company’s listings to national listing aggregator sites Zillow, Trulia and Realtor.com.

Sounds exactly like what Edina Realty announced in November 2011. (Though curiously, Edina never mentioned backing out of Zillow).

Is there an “anti-syndication movement” afoot in the real estate vertical? Maybe. Maybe not. Only time will tell where this is headed.

Here is the video that Abbott Realty Group Broker and President Jim Abbott released explaining ARG’s decision to no longer syndicate their listings to Trulia, Zillow, and Realtor.com (hereafter referred to as TruZillTor, just because that is faster to type).

If you haven’t watched the video, I encourage you to do so.

First, let me say this. I respect Jim Abbott and ARG for taking a stand on a topic they obviously feel passionately about. That’s not an easy thing to do, and Jim’s video is well produced, and he makes many points. Perhaps too many, as sometimes, for me, it’s difficult to know if he is addressing the real estate industry or real estate consumers. But that’s neither here nor there. This article isn’t a critique of the video. It’s a critique of the message.

Second, let me say this. I am “pro-syndication.” That shouldn’t be a surprise. If you read my article on the Edina announcement, that position is clear. I am not against other people advertising my listings, as was clearly stated in You Have Full Permission to Advertise My Listings, written almost three years ago. There are countless other places here and all across the internet where I have supported listing syndication.

Why I disagree with the ARG Abbott Realty Group decision

This is a complicated topic that many feel strongly about regardless of which side of the syndication fence they fall on. I think the best way to tackle it is to discuss each of Jim Abbott’s points in the order he made them. So let’s go…

Listing syndication sites are in business to sell advertising to real estate agents and brokers.

Yep, true statement.

Neither the home seller or the potential home buyer is remotely well served by listing syndicators.

Hmm. This is debatable. Jim’s first point in support of this statement is that the syndication sites, “are really nothing more than slick advertising platforms. They often use fear and peer pressure to induce agents and brokers to sign costly long-term contracts for their lead generation services.”

Yes, we’ve already established that syndication sites sell advertising. “Fear and peer pressure”? Inducing agents to buy advertising? I don’t know about you, but I began the “don’t succumb to peer pressure” talk with my kids when they were about five years old. If you don’t like the fact that syndication sites sell advertising, that’s fine. Don’t buy it. Peer pressure? Put on your big girl panties and stand up to the peer pressure and do what YOU think is right. ARG is doing what they think is right. So is Edina. So am I.

Jim states the real estate industry is vigorously regulated by local, state and federal government to protect the public, and they the syndication sites face no such regulation and have no legal responsibility for the accuracy of the data they display.

Also a true statement.

The syndicator sites will tell you they go through many gyrations to ensure accurate data. Well, I agree with Jim and can assure you that these sites are filled with inaccurate information – sold listings, expired listings, missing listings, homes listed for sale that aren’t.

Unfortunately, inaccurate listing data isn’t limited to the syndication sites. Take a peek at your local MLS. If it’s anything like mine, and I suspect it is, it too is filled with inaccurate and missing data.

I just logged into the Arizona Regional Multiple Listing Service (ARMLS) and in 30 seconds or less found this:

283 listings with no square footage entered. That’s just agent laziness.
12 listings showing a square footage of 0, 1 or 2 square feet. When is the last time you saw a one square foot home? My ass is bigger than one square foot.
14 listings showing both zero bedrooms and zero bathrooms. A home with no bedrooms or bathrooms? What is it, a tent?
484 listings showing property taxes of less then $10/year. I *wish* my property taxes were less than 10 bucks.

I have no way to count how many listings have the wrong price, the wrong listing status, the wrong directions, the wrong address.

We get calls every day about listings showing as Active in the MLS and when we call the listing agent it is not unusual, at all, to hear things like:

Oh yeah, that one. It’s been under contract for a couple of weeks. I forgot to change the status in the MLS
Yes, there is an HOA. I just haven’t had time to look it up
There are multiple offers submitted, we aren’t taking any more
I don’t know if it’s a one story or two story
I don’t know if it has a pool

The list goes on and on. You can’t make this stuff up.

Garbage in, garbage out. And shame on us for being so lousy at entering, maintaining and correcting listing data.

The MLS is not a sanctity of data integrity. I don’t believe the data in the MLS is as bad as it is on the syndication sites, but it’s clearly bad enough that the “integrity of the data” argument is moot.

And lest we forget, every major syndication site has a way to correct inaccurate data. If you aren’t correcting bad data, that is just as much your own fault as it it is the syndicators.

Jim Abbot asks why do syndication sites inflate their inventories and says again that one reason is to, “extract exorbitant fees from unsuspecting agents and brokers”. Extracting exorbitant fees? Well I’ll say again the stunningly obvious solution is to keep your credit card in your wallet or purse. Unsuspecting agents and brokers? Why are you “unsuspecting”? If you aren’t researching who you are spending your advertising dollars on, that’s your mistake and your problem.

Jim mentions that CraigsList scammers and burglars use syndication site listing data to target their victims. Uhm, how does he know that they aren’t using any real estate agent site that utilizes and IDX home search solution. Tens of thousand do, including ARG’s web site. It took me two clicks on ARGs site to find a property address… Throwing syndication sites under the bus for enabling scammers sounds like fear mongering, and rather absurd when your own web site offers the same information.

Next up we have the often heard argument that syndication sites take our content because they have to have it to drive traffic, and they do so, “without compensation to the brokers, agents, photographers and videographers who create pay for and own the content”. He even states, “As if the theft of our intellectual property weren’t enough…”

They take our content? They steal our content?

Hardly. We give it to them. Now Jim’s chosen not to, as is his prerogative. I chose to give them my content, as is my prerogative. But please, don’t tell me they are stealing it. That is ludicrous.

Consumers are the ones who really get a raw deal at the hands of syndicator sites.

Here Jim tells a story of a potential home buyer who finds a home on a syndication site and calls the agent most prominently featured. Jim is correct when he says this may not be the listing agent, rather it is the agent who paid for the advertising to be featured. The poor consumer may be routed to a call center, where the operator offers to “put you in contact with a qualified professional who knows the area” and that, “it is almost certain they have not seen the property you called about”.

There are currently 25,312 active residential listings for sale in Phoenix. According to the home search on ARG’s website, there are 12,259 active residential listings in the San Diego area.

I don’t know Jim, and I don’t believe I know any ARG agent. But I’m quite comfortable saying that if you find a property on ARG’s site – or any other real estate agent or broker site with IDX listings – and call that office the odds are overwhelming that the agent who answers the phone hasn’t seen the listing you are calling about. I *know* that I don’t have an agent that has seen the every one of the 25,000+ listings in Phoenix.

These sites represent a failed approach to property marketing

Jim says that the “hundreds of thousands of hits” on their own listings on syndication sites, “did not cause buyers to view those homes, nor did they produce quicker sales or better outcomes for our clients” and that a few buyers who responded to listing syndicators often “got the wrong information or got it too late to be of value to them as consumers”.

That may well be true. I am not privy to ARG’s numbers, and certainly can’t question them. Jim seems like a good guy. Professional. Passionate about his brokerage, agents and clients.

To be honest though, I have no idea how ARG (or anyone) can track this sort of data accurately.

Let’s say I’m an agent in San Diego, the home of Abbott Realty Group. Let’s say I pay Zillow to “own” a zip code where ARG has a listing. Let’s say a potential home buyer finds an ARG listing on Zillow and contacts me. We drive out, my client loves the home, and we submit an offer the seller accepts.

Does ARG survey every buyer of every one of their listings and ask them where they found the home?

Maybe they do, I can’t say. We certainly don’t, and I don’t know anyone who does. Honestly, I couldn’t care less where the buyer of one of our listings first found the home. We take listings to sell them. And whether some buyer finds our listing on TruZillTor, our own site, some other local agents site, or via any other marketing, I don’t care. We sold the client’s house, which is what we were hired to do.

Is it possible no Thompson’s Realty listing has ever been sold via TruZillTor? Yep. Is it possible some have? Yep.

The total cost for me to put our listings on syndication sites is $0.00. I have never given any syndication site a nickel. The cost is not passed on to our clients, the cost is zero. You see, we investigate the ROI of every marketing avenue. We don’t succumb to fear, intimidation or peer pressure. Heck, I’ve had potential seller clients that insisted we run ads in the Sunday paper. When we explain that they don’t work, and why, the vast majority of sellers understand and we move along without the shiny Sunday add. The two or three I can recall insisting we run ads found another agent. We don’t take listings for the sake of taking them, to plant signs in the ground, to generate “leads”. We take listings to sell them. We don’t spend time, money or effort that doesn’t work to appease sellers. Syndicating our listings is done through our MLS. We check a box (or not if the client doesn’t want syndication). The fraction of a second it takes to check a box has essentially zero cost.

At ARG we believe that when you hire a skilled, professional Realtor to represent your property that he or she is the best qualified and most logical person to respond to questions from buyers and buyer’s agents.

This is an argument I heard several times since the ARG announcement was made. It sure feels like what we’re talking about here is single-agent dual agency — where the same agent represents both the buyer and seller in the same transaction. We abhor single-agent dual agency, practice it only under very rare and extenuating circumstances and honestly wish it was outlawed.

Maybe dual agency isn’t the ultimate goal in either ARG or Edina’s pulling out of syndication. I don’t know. Let’s assume that is not their goal as I’d rather not go down the dual agency rat hole 2,100 words into a blog post (and kudo’s if you’ve read this far. It’s almost over…).

But here is what I will say about this “the listing agent is the best qualified, and who the potential buyer needs to answer questions” argument.

If you feel syndicators are harming consumers by making it difficult to contact listing agents, they you must, MUST, also keep your listings out of IDX distribution. The exact same issue of not reaching the listing agent that seems to bother so many in syndication also exists in IDX.

Trust me, we get calls and emails – seven days a week – from people searching on this very site who think we are the listing agent for the property they are viewing. Every. Day.

Don’t get me wrong. I **LOVE** IDX. It’s the lifeblood of my prospect generation efforts. 6,742 IDX search registrations in 2011 is a great thing. But if one of your main arguments for pulling your listings out of syndication is because potential buyers are confused and can’t reach the listing agent, then you MUST also pull out of IDX. The same problem exists in both systems. You can’t have your cake and eat it too. Pulling out of syndication but using IDX smacks of hypocrisy.

This comment about IDX was made by an agent I have tremendous respect for, J. Philip Faranda:

If I am on Thompsonsrealty.com or TPREG and inquire about a listing I know who I am being connected to. It is your site. There is no ambiguity. If I am on a 3rd party site it is misleading to the public far more. I DO get my share of IDX calls where people assume Jay’s listing is really mine, but it is easy to clear up because it is My site they are on. Not so with Z, T and R. IDX is the solution, not the problem.

Problem is, there IS ambiguity. The very ambiguity that exists on syndication sites. The vast majority of site visitors don’t know (or quite possibly don’t care) what site they are on. Sound far-fetched? I mean “Phoenix Real Estate Guy” is plastered all over the place. Along with logos, contact forms, call to action buttons, you name it, we’ve got them all over our site, just as ARG does, just as any good real estate site does. Our sites are many things – information, brand promotion, advertising, and prospect generation vehicles. I can assure you that many many people think we’re the listing agent for any listing on our site. Heck, I get phone calls and emails asking about things as diverse and non-real estate related as what hours a restaurant is open, to whether or not you need a passport to cross the Mexican border. Why? Because people Google those questions and land on an article I’ve written about them. Clearly my site isn’t a restaurant site, or the State Department. But people think it is, because Google sent them there.

Just like Google sends them there for a listing address or MLS number they Google.

Jim Abbott supports IDX. He does not support syndication. Yet many of the issues he cites as problematic with syndication also exist in IDX. Edina supports IDX, but not syndication for many of the reasons Jim Abbott and ARG Abbott Realty Group state.

Sorry folks, I don’t get that. At all.

As I said in the beginning of this tome, I respect Jim Abbott and ARG for taking a stand in what they believe. Ditto for Edina, and anyone else that decides to do this. I believe their feelings are genuine.

Genuine, but misguided.

Photo Credit: Experian Hitwise

Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader, the site you are on is guilty of stealing content.

On Flat Fee “MLS Only” Real Estate Brokerage

Jay Thompson — Sat, 28 Jan 2012 03:07:54 +0000

This hit the email inbox today. It happens on a quasi-regular basis…

Hello,
We are selling our loft by owner and we see it is listed on your website, but that it hardly has any pictures – and certainly not the types of pictures that would attract buyers. Is there any chance you could replace the main picture on your website’s listing and perhaps add more pictures? I’m attaching some photos of the loft. We like the first photo the best.
Thanks,
John and Jane Doe

(Names obviously changed. My emphasis in bold)

Here is what is going on.

John and Jane have “listed” their home for sale with what is typically called a “Flat Fee” or “MLS Only” real estate brokerage. For some set fee (typically $250 – $500 or thereabouts) a real estate broker will enter home sale data into the Multiple Listing Service (MLS). Some also provide a for sale sign, maybe a lock box. Services vary.

What these types of brokerages will not do though is represent you in a real estate transaction. No marketing, no advice, no negotiations, no handling of offers. No nothing other than putting your data into the MLS. Everything else in on the sellers. There will even be notes in the MLS to buyer agents that all offers must be presented directly to the sellers. A prudent buyer agent will ask the sellers to sign an “Unrepresented Seller” addendum should their clients decide to make an offer.

When listings go into the MLS, they are shared across real estate websites via an “IDX feed” (Internet Data eXchange). Basically the MLS data — verbiage and photos — are fed to other local (and national) listing sites for display.

Sites like this one.

So what John and Jane are seeing when they see their home “listed on this site” is the MLS data their flat fee agent entered into the MLS.

I can not change that data. Only the agent (or their broker) that entered the listing into the MLS can change the data. This makes perfect sense if you think about it. There is no reason for me to be able to change the data. It’s not my data. And you don’t want different variations of the same listing spread across hundreds / thousands of web sites.

There is nothing I can do to help John and Jane better present their listing. That’s their agent’s job.

But they don’t really have an agent…

Why Would You Use a Flat Fee MLS Only Broker?

Ostensibly, to save money. Let’s face it, real estate commissions are not cheap. Typically, homes are listed at 5 – 6% commission, with that amount typically being split 50/50 between the listing brokerage, and the brokerage representing the buyer. (Of note, I emphasis typically. Real estate commissions are not fixed and are negotiable.)

So, for example purposes only, let’s say John and Jane list their home with a full service brokerage and negotiate a 6% commission — with 3% going to the listing agent and 3% to the buyers agent. If they sell their home for $150,000, then they would have to pay a total commission of $9,000; $4,500 goes to the buyer’s brokerage, and $4,500 to the listing brokerage. That is not an insignificant amount of money.

The vast majority of flat fee MLS Only users understand that they still have to offer a commission to a buyer’s broker. Without that, it would be difficult to attract buyer’s agents. After all, real estate agents are people too (really!) and few people have the means to work for free.

So the sellers utilizing a MLS Only brokerage can, in theory, save 3% (or so) on commissions. They don’t pay any commission to the MLS Only broker.

Okfine.

But those considering using an MLS Only brokerage should consider a few things other than just the “savings”.

Their time. You’ll be doing legwork an agent normally does. Argue all you want that real estate agents don’t earn their commission. But don’t tell me you won’t have to spend some time doing things (like emailing some broker a bunch of pictures hoping he can change your “listing,” among other things). Time is money.
Their knowledge. It is readily apparent that John and Jane had no clue about how IDX works. Let’s hope for their sake they have more of a clue about all the required disclosures, the legal ramifications of failure to complete those disclosures properly, contractual date-sensitive clauses, and the legal and financial ramifications of failing to meet those dates.
Their ability to negotiate with a buyer’s agent. Not to sound crass, but if I am presenting a buyer’s offer to an unrepresented seller, I am going to do my best to eviscerate them at the negotiating table (in a polite fashion, naturally). That’s what my buyer pays me for.
Knowing who is inside your home when you are not. Some MLS Only brokerages will provide a lockbox so buyer agents can access the home. What they may not provide is the report saying who was in your home and when they were there. And if you think putting “call for an appointment to show” into the listing will prevent agents from walking into your home uninvited, think again.
There’s more. I think you get the idea…

I’m not slamming MLS Only brokerages

I am on the record countless times saying that there are many different brokerage models out there, and for the most part, they all serve a purpose (just don’t get me started on the “hire anyone with a license and a pulse” model. That serves no purpose other than lining some broker’s pocket). Different models promote innovation and competition, and both of those are good for agents, brokers, and home buyers and sellers. If you have the means to sell your home yourself, go for it. Nothing wrong with saving yourself some coin. Personally (and professionally) I don’t think you will actually save all that much money, and there is certainly a price tag on saving yourself a lot of hassle and possibly placing yourself at legal and financial risk.

I will freely admit that I’ve been noodling this article all day, trying to come up with a truly valid reason for using an MLS Only brokerage.

And I can’t.

Momentarily I thought to myself, “Well, if a homeowner is on the hairy edge from an equity perspective, where saving even a few hundred dollars is the difference in not having to short sell, maybe MLS Only makes sense.

Maybe. On the other hand, maybe if you are that close to the edge of entering the short sale abyss what you need more than ever is professional representation…

Help me out here. Drop me a comment with a solid argument for using a MLS Only brokerage. As in a tangible benefit over using a full service brokerage. Surely there is one and I’m just not thinking of it…

Disclosure: As the Broker / Co-owner of a full service real estate brokerage, I am quite aware of my bias toward full service. I did my best to present this information as impartially as I could.

Photo Credit: Money. By 401K on Flickr. CC Licensed.

Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader, the site you are on is guilty of stealing content.

Thoughts on ‘Crowdsourcing’ in Real Estate

Jay Thompson — Sun, 22 Jan 2012 19:43:22 +0000

Yesterday I finished reading the latest Stephen King tome, “11/22/63” (a great read by the way). Needing a new book, I posted this on my Facebook Profile:

I need a new book to read. Not some business / self-help / save the planet book. I want mindless entertainment. Mainstream fiction, historical fiction, perhaps a biography. Suggestions?

Within minutes, I started getting suggestions from my Facebook friends. Dozens of suggestions. Of course the humorists in the bunch suggested things like “Everybody Poops” and “Goodnight Moon” (which I can still recite from memory some 15 years after having last read it to the kids for the ten thousandth time). But I would expect nothing less from my friends…

As the suggestions rolled in, I created a Wish List on Amazon — Check it out here.

That list currently has 73 79 books on it (including a few I’ve already read). As I added books to the list, I read some of the reviews on Amazon to help me decide which book to read first . For the record, I wound up picking Keith Richards autobiography “Life”. I *think* next up will be Ken Follett’s “The Pillars of the Earth” — but who knows.

What I chose is neither here nor there.

Sifting through the suggestions, and reading reviews on Amazon got me to thinking about “crowdsourcing”, and being someone obsessed (possessed?) with all things real estate, I also started thinking about how social media connections and crowdsourcing and reviews might impact real estate. More specifically, how people pick and chose a real estate agent to work with.

What is “crowdsourcing”?

According to Wikipedia, it is:

… the act of sourcing tasks traditionally performed by specific individuals to a group of people or community (crowd) through an open call… Crowdsourcing is a distributed problem-solving and production model. In the classic use of the term, problems are broadcast to an unknown group of solvers in the form of an open call for solutions. Users—also known as the crowd—typically form into online communities, and the crowd submits solutions.

OK, so maybe asking your friends for suggestions on what to read (or what real estate agent to use) doesn’t exactly fit into the traditional use of crowdsourcing. But you get the idea. Ask a bunch of people for help with something — help picking a book, or a real estate agent — and use their input, along with other resources like reviews to make a decision.

Coincidentally, late last week I talked to a reporter with Smart Money about real estate agent reviews. She wanted some opinion on why agent reviews haven’t gained the traction that other businesses, services and products are seeing. Great question. I’m a fan of agent reviews, and have written about them a few times. I even created a little site to assist our clients in leaving reviews for our agents.

Sooner or later, agent review sites will gain traction, whether agents like it or not.

And why not? Let’s face it — input from our friends, our “social sphere” and even what random people say and think about a service or product is important. In 2009, a Nielsen study found that, “Recommendations from personal acquaintances or opinions posted by consumers online are the most trusted forms of advertising.” Hasn’t everyone looked at reviews for movies, books, restaurants, cars, electronic products (and more) when making purchasing decisions? Professional services like doctors, lawyers, even schools and teachers are widely reviewed online.

So why not real estate agents?

Those agent review sites are out there, and they will at some point gain more traction and use. It’s a matter of when, not if. It’s already happening to some degree.

Clearly picking a real estate agent is not like choosing a book, deciding where to eat, or what movie to watch. But there are similarities. Whether picking a product, a service or a service provider, we trust our friends opinions. We trust human opinion — hence the popularity of review sites.

If you are in real estate and you think people are not out there asking their friends and family for recommendations, then you’ve lost your mind. People have asked, and will continue to ask friends about what real estate agent to use, what real estate site has the best information, the best home search solution. They even ask their friends where they should live and what they think about a particular home or neighborhood.

“Crowdsource” a real estate agent?

Sure, why not?

What say you?

Photo Credit: “Liverpool Street station crowd blur” by David Sim (victoriapeckham on Flickr). CC Licensed.

Disclosure: Amazon Wish List and book links are affiliate links. I’ve made $8.52 on Amazon links since July 5, 2009.

Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader, the site you are on is guilty of stealing content.

BiggerPockets Real Estate Investing Summit 2012

Jay Thompson — Fri, 06 Jan 2012 20:01:19 +0000

If you are a real estate investor, seasoned or just getting started, or even if you are just curious about real estate investing, you would be wise to consider attending the BiggerPockets Real Estate Investing Summit and Expo on March 23 – 24 in Denver.

Thompson’s Realty is proud to be a sponsor of this event.

Why do we sponsor?

Because there is a ton of misinformation out there about real estate investing. Misinformation that can cost you tens of thousands of dollars and/or get you into a boatload of trouble. 90% of real estate investing is knowing what you are doing. I don’t care what you think you know, this summit will teach you a lot. Knowledge is power folks.

I’ve known the organizer, Josh Dorkin, for a long time, and Josh knows real estate investing. His site, BiggerPockets.com, is a wealth of information for real estate investors — the best site on the internet as far as I’m concerned.

Josh has lined up a world-class list of speakers for the summit, including Thompson’s Realty own Marty Boardman. The agenda is already filling up with some very interesting topics.

The BiggerPockets REI Summit is in its inaugural year, and it’s already looking like the “go to” conference to real estate investing.

Go forth, learn, network. Meet people, get great ideas an information. Take your real estate investing to the next level.

Click here for all you need to know about the BiggerPockets Real Estate Investing Summit and Expo 2012

Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader, the site you are on is guilty of stealing content.

How to Make a Home Seller Happy

Jay Thompson — Wed, 04 Jan 2012 23:38:03 +0000

Something I hear from real estate agents frequently:

I do _________ just to appease my home selling clients.

You can fill in that blank with things like:

Running ads in the Sunday paper
Holding open houses
Using QR codes on sign riders
Enhancing listings on Realtor.com
Setting up a Facebook page for the home
Blasting an email notification to every agent in town

Or any of an assortment of “marketing” tricks and gizmos one might imagine.

(Of note: I’m not saying that anything listed above is necessarily a bad idea. They may work in your market. Personally I’ve found them all ineffective and a waste of time, money and/or effort. But your mileage may vary.)

True confession – I’ve never understood the “appease the seller” argument.

Oh, I understand that everyone wants to make their clients happy. After all, we are in a service based industry. Making the client happy goes a long way toward improving client satisfaction. Happy clients are repeat clients. Happy clients refer their friends and family.

What I don’t understand is doing things that don’t work (or are, at best, ineffective) just to make your seller happy.

The Key to Making a Seller Happy

Mayhap I am about to grossly oversimplify things, but making home sellers happy seems to me to boil down to one thing…

Sell their home.

Having spoken to countless home sellers I can safely say I have yet to hear anyone say, “My agent used this bitching QR code on our sign rider!” or, “Who cares that our home never sold, the Facebook Page our agent created for our home was AMAZING!”

Sell their home.

That’s what home seller’s want. They don’t really care how the home gets sold. Just sell it. Sell it as quickly as possible. Sell it for as much as the market will bear. Put them through the least amount of pain possible.

That will make your home sellers happy.

You take a listing to sell the home. Not to generate buyer leads. Not to get yard signs plasted across town. Not to promote yourself.

At least I hope you don’t take a listing for those things…

It isn’t your seller’s job to generate sales prospects for you. It is not your seller’s job to pad your database of potential buyer clients. It’s not your seller’s job to showcase your for-sale sign.

Those are all parts of your job, and they have to be done, but they shouldn’t be done at the expense of your seller.

If you take a listing, do what you are being paid to do.

Sell the home.

Trust me. Do that, and your client will be happy.

Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader, the site you are on is guilty of stealing content.

Thompson’s Realty Welcomes Angela Higgins!

Jay Thompson — Wed, 04 Jan 2012 00:24:28 +0000

Let’s start off 2012 with a bang!

We’re pleased to welcome Angela Higgins to our growing family of world-class real estate agents / human beings.

Angie comes to us from RE/MAX Excalibur and has been licensed since 2007. She previously worked at Century 21 Northwest and began her real estate career with Diversified Partners.

Real estate is in her DNA, her mother is a commercial / residential developer in Maine and her dad is a General Contractor.

She brings with her a formal education (BA in Psychology from the University of Maine with a Minor in Food Science / Nutrition) and a wide variety of real estate experience. From commercial shopping center retail development and leasing to listing properties for Freddie Mac and Fannie Mae. And all points in between.

Super smart, a bit sassy, and a genuinely nice person. I think she’ll fit right in…

I asked Ang for a little info about herself, this part I liked the most:

I crush short sales in the palm of my hand

I treat every transaction like it was my own

I love to run, hike, lift weights, travel, dance and crack jokes

As for name preference, she said, “No preference on the name… Angela, Angie or Ang on rotation.”

Call her what you want. I call her a great addition to the team.

Welcome aboard Angela!

Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader, the site you are on is guilty of stealing content.