The Power Struggle: Why Local MLSs Must Consolidate

Introduction

In today’s digital age, the real estate industry is more interconnected than ever before. Despite this, many local Multiple Listing Services (MLSs) are holding onto power and control, rather than focusing on the best interests of real estate agents and brokers. This article will explore the history of MLSs, the role of local associations, the fragmentation of MLS systems, and the case for consolidation.

A History of Information Power

In the late 1800s, American real estate professionals began gathering in person to share information about their listings and sales. This practice, which wasn’t yet formalized as the MLS, involved verbal communication and personal notes. As the industry grew, the National Association of Realtors (NAR) was founded in 1908, providing a framework for these groups. However, it wasn’t until the advent of the internet in the 2000s that the attempt to maintain control over information on a local level turned into an archaic power grab.

The Role of Local Associations

Before NAR, local Realtor associations were informal groups sharing information. In the 1900s, under the umbrella of NAR, they played a crucial role by providing a place to gather, share information, access MLS books, and receive training. Today, the role of local associations is diminishing or becoming obsolete, although they would argue against any statement that poses a threat to their existence. State associations, however, provide essential services such as standardized forms, policy advocacy, and education, which local associations can no longer match.

The Fragmentation of MLS Systems

While Realtors might tolerate the existence of inconsequential local associations, many are frustrated by the fragmented MLS systems. Some agents must join multiple MLSs, leading to multiple memberships, fees, platforms, and redundant activities to maintain listings and searches in multiple systems. It’s no wonder that consumers often turn to websites like Zillow, which provide unified data more effectively than the fragmented MLSs that agents are using.

The Case for Consolidation

There are several compelling reasons why local MLSs must consolidate:

1. Unified messaging and actions: A unified organization would have a single, consistent message and approach, rather than the current disjointed and confusing approach.
2. Efficiency and reduced costs: Consolidating local Realtor Associations and MLS systems into single-state entities would streamline administrative processes, reduce redundant efforts, and lead to significant cost savings.
3. Data consistency and standardization: A unified MLS would ensure that all listings follow the same rules and standards, unify field names and values, and reduce confusion and discrepancies.
4. Improved education: Rather than each local association and MLS creating their own training and education, a more comprehensive and consistent approach could be made through consolidation.
5. Increased influence and bargaining power: A larger, unified organization would have greater influence when negotiating with technology providers and other vendors that provide resources to associations and their members.

Accountability?

While local real estate organizations were once essential, modern technology has rendered many of their original functions obsolete. The only thing holding these organizations in place is the sheer determination of those who want to maintain power. They want to maintain their influence, their data, their control, and what they probably consider to be their money. The truth is that it all belongs to the industry, an industry whose future lies in unity. It’s time for the real estate industry to consolidate and become a powerful, unified leader.

Conclusion

The case for consolidation is clear. By consolidating local Realtor Associations and MLS systems, the real estate industry can create a more efficient, cost-effective, and unified organization that benefits agents, brokers, and consumers alike. It’s time for the industry to put aside petty squabbles and focus on the greater good.

FAQs

Q: What is the main argument against consolidation?
A: The main argument against consolidation is that local associations and MLSs are more effective and efficient when operated separately.

Q: What are the benefits of consolidation?
A: The benefits of consolidation include reduced costs, improved education, and increased influence and bargaining power.

Q: What would happen to local Realtor associations and MLSs if they consolidated?
A: Local Realtor associations and MLSs would likely be merged into single-state entities, streamlining administrative processes and reducing redundant efforts.

Q: How would consolidation affect data management and access?
A: Consolidation would ensure that all listings follow the same rules and standards, unify field names and values, and reduce confusion and discrepancies.

Q: Would consolidation lead to job losses?
A: Consolidation could potentially lead to job losses, as redundant positions and roles would be eliminated. However, the industry could adapt and create new roles and opportunities.

Q: What is the current state of MLS systems in the US?
A: There are currently 535 MLS systems in the US, with 59% certified for the current RESO standards, 2% certified under older standards, 31% having completed technical testing but not certified, and 8% uncertified.

Author: www.inman.com

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