Mert's MLSNI post

[MattL]

This is in response to Mert's recent blog post at that other useless forum:
http://www.realestatewebmasters.com/...mert/341/show/

First, let me say that compared to MANY MLSes in America, MLSNI has some of the most progressive (and pro-consumer) policies around.

To contend some of Mert's points:

1. The IDX feed for MLSNI contains 87.5% of the full MLS (by today's numbers).
2. Of those properties excluded from the IDX feed, 20% of them belong to Coldwell-Banker Residential and Baird & Warner -- the original defectors to MAPMLS because of MLSNI's VOW policy. Another 20% belong to RE/MAX offices that are pushing IllinoisProperty.com. And, personally, I would say that at least half of the remaining listings are blocked unintentionally, because the listing agent doesn't understand the implications.
3. The "forced login" policy is very, very good for Realtors and beneficial to consumers. Most significantly, it prevent the wholesale exploitation of your site by other Realtors (which DOES happen). For consumers, it allows far more functionality and, potentially, improves the solution's intelligence through personalization. You wouldn't sit with an on-site client for an hour searching properties without getting any contact information, so your "virtual office" shouldn't be any different. MLSNI has pledged to uphold this policy even if NAR adopts a modified ILD policy, so get used to it.
4. MLSNI's policy allows cooperative advertising, which is an easy way for an internet startup to defray costs. This is specific to MLSNI, as NAR's default VOW policy does not permit advertising on listing pages.

What Mert SHOULD be complaining about:

1. The handful of megalithic brokerages that "blanket opt-out" their own listings from the IDX feed while merrily displaying competitors' listings on their site. This is one provision of the ILD policy with which I whole-heartedly agree -- if you opt-out, you may NOT display other Realtors' listings on your own website. Then it's more of a cut-off-your-nose-to-spite-your-face policy, and there would be some disincentive to opting-out.
2. The lack of industry standardization in IDX, VOW, and RETS data feeds. Having been a software developer for 10+ years, I can't believe how poorly implemented the "standards" are in this market, or how disparate are the three sources. Having true standards would allow far more code reuse, and afford a lot more cooperation (even conversation) between developers from different firms. As it stands, each company that creates a solution (myself included) actually benefits from withholding the "secrets" of making it work, usability improvements, and so on.
3. NAR's national anti-competitive practices that relate to the Internet (i.e., most of the DoJ's anti-trust allegations). In my eyes, they are all fairly valid in some way.

-Matt

[Jim Messenger]

Hey Matt,

Happy New Year. Glad to see you here.

I am curious though, why are you replying to a post Mert made elswhere on this forum?

Jim

[MattL]

Because I prefer to have quorum here.

-Matt

[Mert]

Jim,
First of all I hope you feel better. I am happy to see you live and kicking again in the forum. Matt is a programmer and work for a mortgage company that owns a very popular VOW (PMPVOW-Matt sold the software to the mortgage company). The company provides the VOW to realtor sites as an almost free service to improve the mortgage company's realtor and brokerage relationships in Chicagoland. I respect their program but not use it as a professional choice (which should not reflect on the quality of their product which truly is a good program) so please donot take this thread as self promotion but rather an intellectual debate as I also take Matt as a friend. I can see the reasons of his questions being here instead of the other forum to be more private without third party interference as he knows I read both forums.

Matt,

You asked the questions so I will answer and ask questions myself.

How can the requirement of sharing private information, access and requirement of storing that private information in realtor's servers (which probably are not the safest places against hackers be a pro-consumer policy (it is barely a pro-realtor policy if you call it that)).

(The IDX feed for MLSNI contains 87.5% of the full MLS (by today's numbers.-->Matt's quote)). I just checked the Koenig & Strey website. Their pre registration number is 49,513 out of 83,938. Please tell me if I am missing something.

Thank you for giving me the numbers for big brokerage absentees and the points that you reminded me that I missed about the anti-competitiveness, software issues (and my god are there issues), NAR's ILD issues. I fulheartedly agree with you, I will actually update the blog right away to reflect those points as soon as I am done writing the response.

(MLSNI has pledged to uphold this policy even if NAR adopts a modified ILD policy, so get used to it-->Matt's quote) I certainly believe in public opinion changing things. Funny, I am the Turk here (who grew up in a less democratic society). I should be the one saying that not an American. About your points, this is my opinion that it should be the right of a realtor to choose when and how to create lead generation and how much info to give to the client or how to present that information to best serve the client as a real estate professional without additional limitations.

(The forced login policies block the consumers as much as the exploiting realtors(Matt's quote)). The whole sale exploitation of my webpages can be prevented by one call to the managing broker of the agent with the threat of a letter to Realtor and IDFPR ethics board plus a letter from my lawyer threatening to sue for damages though I agree with you about it being pain. But just like spam mail you take the good with the bad.

(For consumers, it allows far more functionality and, potentially, improves the solution's intelligence through personalization-> Continuation of the above quote by Matt) Don't you think a free IDX would allow the programming of more specific search related pages to already exist when a potential customer is looking for that specific info through other possible search tools (even a keyword search tool for that matter) on the website. There are many many multiple ways to reaching high efficiency functionality (which actually to give you a point kills the conversion rates of a realtor either way (my way or your way that is, if enough information is given through the realtor sites by killing the need for a buyer agency).

"MLSNI's policy allows cooperative advertising, which is an easy way for an internet startup to defray costs. This is specific to MLSNI, as NAR's default VOW policy does not permit advertising on listing pages". While I see your point on defraying costs, I can not see myself and many realtors out there to advertise a mortgage company in their search result(or any other company) and still be deemed trustable and neutral in the eyes of the buyers when giving professional advice (ironically currently many of my realtors do use one of your loan officers but I donot have a policy on enforcing the advertisement of one single mortgage company)

Let me know what you think...

Originally Posted by MattL This is in response to Mert's recent blog post at that other useless forum: http://www.realestatewebmasters.com/...mert/341/show/ First, let me say that compared to MANY MLSes in America, MLSNI has some of the most progressive (and pro-consumer) policies around. To contend some of Mert's points: The IDX feed for MLSNI contains 87.5% of the full MLS (by today's numbers). Of those properties excluded from the IDX feed, 20% of them belong to Coldwell-Banker Residential and Baird & Warner -- the original defectors to MAPMLS because of MLSNI's VOW policy. Another 20% belong to RE/MAX offices that are pushing IllinoisProperty.com. And, personally, I would say that at least half of the remaining listings are blocked unintentionally, because the listing agent doesn't understand the implications. The "forced login" policy is very, very good for Realtors and beneficial to consumers. Most significantly, it prevent the wholesale exploitation of your site by other Realtors (which DOES happen). For consumers, it allows far more functionality and, potentially, improves the solution's intelligence through personalization. You wouldn't sit with an on-site client for an hour searching properties without getting any contact information, so your "virtual office" shouldn't be any different. MLSNI has pledged to uphold this policy even if NAR adopts a modified ILD policy, so get used to it. MLSNI's policy allows cooperative advertising, which is an easy way for an internet startup to defray costs. This is specific to MLSNI, as NAR's default VOW policy does not permit advertising on listing pages. What Mert SHOULD be complaining about: The handful of megalithic brokerages that "blanket opt-out" their own listings from the IDX feed while merrily displaying competitors' listings on their site. This is one provision of the ILD policy with which I whole-heartedly agree -- if you opt-out, you may NOT display other Realtors' listings on your own website. Then it's more of a cut-off-your-nose-to-spite-your-face policy, and there would be some disincentive to opting-out. The lack of industry standardization in IDX, VOW, and RETS data feeds. Having been a software developer for 10+ years, I can't believe how poorly implemented the "standards" are in this market, or how disparate are the three sources. Having true standards would allow far more code reuse, and afford a lot more cooperation (even conversation) between developers from different firms. As it stands, each company that creates a solution (myself included) actually benefits from withholding the "secrets" of making it work, usability improvements, and so on. NAR's national anti-competitive practices that relate to the Internet (i.e., most of the DoJ's anti-trust allegations). In my eyes, they are all fairly valid in some way. -Matt

[MattL]

As a preface for Jim -- indeed, my comments are meant to be exploratory and not at all adversarial -- per Mert's comment, I do prefer this board over The Other because there aren't any dummy injections in thoughtful threads and I definitely don't harbor an ounce of animosity against Mert. I know who he is (although we, personally, haven't met), respect his goals, and am familiar with his site and the features we're going to "borrow".

Now, Mert, on to your points:

How can the requirement of sharing private information, access and requirement of storing that private information in realtor's servers (which probably are not the safest places against hackers be a pro-consumer policy (it is barely a pro-realtor policy if you call it that)).

I don't know about you, but a lot more arbitrary people get my email address than someone with whom I may make a several-hundred-thousand dollar purchase -- and that is the only piece of information required to be captured for validity.

I just checked the Koenig & Strey website. Their pre registration number is 49,513 out of 83,938. Please tell me if I am missing something.

They are definitely applying more limiting criteria than the ADI opt-in flag. By today's measure, I see 12.47% with ADI=NO. They are probably selectively blocked, per the current regs, although that's just a guess. I also show them short about 3,000 listings compared to our data.
Regarding MLSNI's ILD stance:

I certainly believe in public opinion changing things. Funny, I am the Turk here (who grew up in a less democratic society). I should be the one saying that not an American. About your points, this is my opinion that it should be the right of a realtor to choose when and how to create lead generation and how much info to give to the client or how to present that information to best serve the client as a real estate professional without additional limitations.

Again, the issue here is that I agree with MLSNI. Removing the login policy will effectively eliminate buyer agents in this market. Have you seen Google Base or RedFin? It would be more of a pain to find a buyer agent than contact the listing broker when the buyer finds what they want. And, on the tails of my earlier "don't go to the listing agent" comment, I really don't think this future would be pro-consumer.

The whole sale exploitation of my webpages can be prevented by one call to the managing broker of the agent with the threat of a letter to Realtor and IDFPR ethics board plus a letter from my lawyer threatening to sue for damages though I agree with you about it being pain. But just like spam mail you take the good with the bad.

I understand your point, but the problem is that it's a one-way street that only hurts the small buying agent in a free market -- you really have to consider competition from Google if you open the regs that much, and Google/MSN/Yahoo! are going to do better than you, period.

Don't you think a free IDX would allow the programming of more specific search related pages to already exist when a potential customer is looking for that specific info through other possible search tools (even a keyword search tool for that matter) on the website. There are many many multiple ways to reaching high efficiency functionality (which actually to give you a point kills the conversion rates of a realtor either way (my way or your way that is, if enough information is given through the realtor sites by killing the need for a buyer agency).

Again, I feel that only the small man suffers in this scenario. A big, savvy Internet brokerage can out-spend any small agent to complete market domination through cut-rate fees (see RedFin as the Wal*Mart of Real Estate), and national lead pimps will cut out all the buyer agents (see Trulia).

While I see your point on defraying costs, I can not see myself and many realtors out there to advertise a mortgage company in their search result(or any other company) and still be deemed trustable and neutral in the eyes of the buyers when giving professional advice (ironically currently many of my realtors do use one of your loan officers but I donot have a policy on enforcing the advertisement of one single mortgage company)

Well, we (as a company) are a good example of making this work -- we offer discount VOWs for the comarketing, or "fair cost" VOWs without it. Alternatively, I know Realtors who offer the opportunity for their Mortgage/Appraisal/Moving/Attorney partners to advertise on a "Partners" page of their site, which amounts to the same as comarketing in Harmon Homes, etc. I (most importantly) was pointing out that MLSNI provides this option while NAR's *cough*anti-competitive*cough* rules do not.

Finally, and this is as much a personal point as anything else, there are good and bad developers, and good and bad plans by either kind of developer. WebPointCentral is a fine example of the well-intentioned-but-ill-planned gone exactly as it should. Their business plan was akin to so many failed dot-coms (which I was a part of) that I could smell blood in the water when we started PMPVOWs (even before they'd fully launched). I predicted failure in three years and they beat me by doing it in two.

The most important factor in managing a successful software project is what I call "reality maintenance" on both sides of the fence (customer & developer). Virtually all developers underestimate complexity or overestimate their skill at some point, and customers always understate their requirements. You're probably either caught with unskilled developers or an unclear goal. Also possible is a burned out development staff that has lost interest in your needs, which happens unfortunately often. I could go on for hours...

-Matt

[Mert]

I have updated the blog accordingly by the way.

[Mert]

Well Matt, we technically met on the phone once though not face to face. I agree with you on the competition chewing the small guy up in terms of Redfin (but man does Redfin create a great map or what) and simple budget power. On the other hand just like real estate SEO, I have seen local agents claiming a small area for themselves kicking out homes.com and such. When the service is the same you are right, price will beat everything. As far as the KSGMAC, they might be limiting the cities on that IDX (in terms of 3K) but my current IDX's search results are also quiet similar.

By the way, I am done with my IDX just going over the graphics now. (don't worry I don't have half your cool options). I am aiming smaller more targeted searches which probably means, I am history when it comes to it. P.S. Before real estate I used to deal with Internet start ups as a automation technology consultant (I am a nurde but not a computer whiz). My biggest mistake was to ask for one better and one better and one better. Now I am done (at least for now).

I also totally understand your point of view. I actually would not mind to show PMP as an advertising partner because I do believe in your service but I doubt you have any other programs other than free VOW, which currently is not that valuable to me.

[MattL]

I do remember speaking to you early-on, and I know Barton still hasn't given up on doing something with you mortgage-wise, so you should give him a call.

RedFin, unlike its local competitor (BuySide Realty) has one significant advantage: big cash backing. Huge cash backing with a sound profit model. They are completely analogous to Wal*Mart in Real Estate: high volume, low margins, highly organized, and well planned. And with backing from Vulcan Capital (ex-Micrsoft founder, Paul Allen), they have a virtually unlimited well to go to while acquiring new markets... and Chicago is coming soon.

While I don't doubt that there will always be niche players, reducing the playing field -- by, say, 10% of online leads -- is going to hurt a lot of independents trying to play the Internet game. How much more business do you have to do in order to cut your margins to 1% commissions? Can whatever you offer offset the shiny-safe-big-corporate feel, even though they only have 35 people? With that in mind, they will probably threaten the online efforts of Realogy more directly, but they will undoubtedly compress your market opportunity... not to mention what happens with Realogy fights back.

I don't mean to be all doom'n'gloom, but, per our earlier conversation, some regulations that may slightly hurt you directly also protect you (as a little guy) from the big predators. MLSNI's policies mean that sites get weighed more fairly on merits, and forced login means you actually get to figure out what features people like, which they don't, and click-paths that need to be optimized.

In summation: Learn from RedFin, be ready for RedFin, be better than RedFin.

-Matt

[Mert]

Actually %.8 percent. I still donot see how they can apply the strategy from West coast prices probably 450-500K average and commission rates (3-5% for buyer agents) to Chicago where average price is 280K and average commission less than 2.5%. Even that rebate company in the North suburbs (I really don't want their name mentioned here-you know who they are Matt) had to back down from those thin profit margins.

[MattL]

Originally Posted by Falcon Living Even that rebate company in the North suburbs (I really don't want their name mentioned here-you know who they are Matt) had to back down from those thin profit margins.

Oh, certainly, but RedFin has what they didn't: big venture capital. Like Amazon, they can stand to be a losing proposition for 3-4 years while acquiring huge chunks of marketshare ($8M can float you pretty far when you're not burning it like crazy, which they aren't). In the end, they'd be a household name and the sheer volume of business would make up for the margins.

I don't think that replicating their approach is necessarily the answer, but the "new market" blend of technology + full-service = low commissions is probably here to stay.

-Matt