2014 may well be the year of the broker, or as they are referred to in MLS speak, the year of the Participant. If your MLS has adopted the National Association of REALTORS® template for MLS Rules and Regulations, you will find that brokers are Participants and agents are Subscribers. As a Participant in the MLS, brokers accept full responsibility to adhere to MLS rules and regulations. The MLS does a pretty good job of enforcing those rules. But who among you is making sure that the MLS is not running afoul?
WAV Group MLS clients are traditionally the largest MLSs in the nation. If the MLS has a member count of less than 2000, it is unlikely that WAV Group has ever facilitated a strategic plan for your MLS. From this perspective, WAV Group has learned that large MLSs rarely run afoul of staying current. The place to spend time auditing your MLS is the small MLS. These MLSs are unlikely to attend NAR’s National or Mid-year meetings where MLS policy evolves. They rely on NAR emails to stay current. Moreover, the MLS board of directors is also unlikely to stay current with MLS policy, which erodes their appreciation and ability to make informed policy decisions. Beyond NAR, there is also the Council of MLS or CMLS. This is the industry trade group for MLS executives that has regular meetings to discuss best practices of operating an MLS. Ask your MLS if they attend NAR Annual, Midyear, and CMLS meetings.
The goal of this post is not to pick on small MLSs. The reality is that they do not have the resources to participate in all of these things. Where WAV Group discovers small MLSs that have fallen behind is when we audit large brokers for rules compliance. Large brokers proactively engage in an audit each year to make sure that all of their systems are in compliance with local rules and regulations. This process is as much a vendor audit as it is a broker audit. MLSs often change rules and the broker or vendor miss the memo on the rules change. Alternatively, the NAR rules change and the MLS does not revise their rules to keep current. Either way, the broker is out of compliance, and is liable for fines and other disciplinary action.
WAV Group gathers the rules and regulations from each MLS then review all of their broker and agent technology solutions to see where they stand. What we often find is that the broker is compliant in some MLSs, and not complaint in others. This leads either to a costly system change or a letter to the MLS with a plea to update their rules. We frequently ask the MLS to proclaim a stay of execution of the broker solution while they pass the new rules.
As a side note, we also encounter issues when supporting brokers who are rolling out Virtual Office Website solutions. In one case last year involving eight MLSs, it took the broker four months to get VOW approval across all eight MLSs. The five large MLSs sent the contract over the day it was requested, approved the signed agreement in less than a week, and provisioned the VOW data right away. You can thank brokers like ZipRealty and Redfin for plowing the path. Three of the MLSs hardly knew what a VOW was, much less had contracts ready or feeds ready.
I think that there is an expectation that every MLS has prepared VOW agreements, and RETS complaint for VOW. Nothing could be further from the truth in America today. I can only imagine the challenges that faced realty executives as they rolled out VOW solutions in more than 150 markets. I suspect that the effort is ongoing, now more than a year in the making.
In order for brokers to compete with online portals in 2014, their MLS will need to support them with data services that allow them to enrich the consumer search experience. Many MLS engage their brokers in one-on-one meetings or through surveys to measure participant satisfaction and understand the growing data needs of their broker. There is no excuse from brokers that do not answer the survey or take the meeting – and that happens more than you think.
WAV Group looks forward to working with brokers to audit their compliance in 2014 and to working with MLSs to make sure that they are doing everything in their power to insure that agents and brokers are getting the best possible service from their MLS.