Tag Archives: project upstream

NAR politics, Instant Offers and a noisy week in real estate

This article was originally published on Inman News:

  • Credit unions are buying brokerages and bundling services.
  • Zillow isn’t a broker but its toes are deeper in the transaction.
  • Alexa’s going to serve you listings.
  • Upstream’s pragmatic pivot is causing a stir.
  • Your choice of MLS may be growing in the future.

NAR’s midyear meetings took place in Washington, D.C., last week. I was just finishing up a recap when two other big stories dropped.

Credit unions are buying up brokerages

Banks are prohibited from opening real estate brokerages. Credit unions, on the other hand, are not. Steve Murray of Real Trends says credit unions are rapidly purchasing brokerages and bundling services.

“Buy from us. Borrow from us. We’ll rebate 20 percent of the commission to you, and we’ll give you 20 basis points off your mortgage’s interest rate. Oh, and we’ll also make your agent whole on the rebate.”

To me, that’s the biggest news of the week. On to that other story you may have heard about:

Zillow Instant Offers

Zillow’s pitch to agents: We’ll facilitate direct purchase offers from our identified investors/venture capital firms/flippers to potential sellers. We’ll let you deliver a CMA to the same folks.

C’est la vie; it’s a business decision. Consumers are given options to work with agents, but some agent-free transactions will occur via Zillow initiation. Offers and transactions are managed in Zillow’s transaction management software.

Zillow’s not technically becoming a broker with this move, but it’s taking on every activity it can that doesn’t require a license — smart. Some agents are screaming. Some are yawning. Let’s just not pretend that initiating a purchase offer for a buyer, providing the forms for the contract, and directing the services upon which it will be transacted isn’t a big shift.

Some agents will love the seller leads. Some are just fed up with the long-running tap dance act of Zillow’s messaging to the industry. Brian Boero distilled it perfectly.

In the latest scene, we’re told, “It’s just a test.” This is apparently supposed to educate us that transactions happening in the real world are none of our concern until the “test” label is removed by the marketing department.

Of course it’s a test, one that management approved, to see if it’s worth expanding nationwide and monetizing. Just tell us, “Shareholders want profits so we’re looking for new revenue streams, and dipping our toes a little further into the transaction looks like a good direction.” We already know.

The Opendoor in the room

Opendoor is the Instant Offers precursor you’re probably most familiar with. While it was reported on Inman that I “chided” Opendoor previously, I’ll note that I commended Opendoor’s leaders and technology. I merely chided the media fawning over a supposed huge new value to consumers.

Flippers are not new, they’re just better financed with better tools, and now they’re getting better access to sellers.

Opendoor’s folks are genius, just as are Moneytree’s founders. They’re doing transactions with massive short-term fees and significant time savings, and putting their services in front of people who may want them. My opinion that these transactions make financial sense for a scarce few doesn’t preclude the businesses from selling them to whoever will buy them.

Alexa’s hawking listings

Back to NAR midyear: voice activated systems (like Amazon’s Alexa and Google Home) became officially approved technologies for brokers to use for delivery of IDX listing data.

While there was some concern about the ramifications, brokers are already using this technology in the field. We want to ensure that the spirit of IDX cooperation and attribution continues, but not hold back innovative brokers.

Will this tech become popular? Spencer Rascoff said at the T3 Summit that he didn’t think it would be a big deal in real estate search. It’s difficult to say, but imagine what it could do to help folks with visual disabilities interact with brokers and agents.

The technology will change by the day. So maybe Rascoff’s right, or maybe brokers have an opportunity. He does have a lot of other things on his plate.

Upstream

Upstream had two big stories last week. First, more NAR funding was approved for RPR to build out the project. Second, instead of only allowing broker/agent listing input at Upstream’s interface, it will now accept a broker’s feed of listing data from the MLS itself.

Spending a week with much of the industry in one place reminds you how much you don’t know. The politics surrounding this initiative are staggering. There are plenty of folks proclaiming Upstream’s “pivot” as a sign of failure.

It’s a pragmatic swallowing of pride. Many insiders will tell you that the divide created by the unfortunate tone of UpstreamRE’s ancestors’ original messaging to the MLS community made this move a necessity. It’s also a big shift from the ideologically pure original intent.

At the same time, it removes the most significant hurdle to access for nearly every broker/agent in the country. There’s no retraining on listing input. You want Upstream? You got it.

The Upstream direct input (which is necessary in its system to solve multi-MLS overlap) requires technical development at the MLS level to accept the listings.

If multi-market brokers like what they see in the Upstream hybrid input product, they may eventually work with their MLSs and vendors to employ the single input solution. In the meantime, vendors may proactively develop software updates that provide faster Upstream implementation options on the most common MLS software platforms.

RPR in the mirror

It seems that someone whispers “National MLS” nearly every time RPR (Realtors Property Resource) is mentioned. If you’ve done the committee circuit for a few years, you know the routine.

Competitors have reason to keep looking over their shoulders, but this particular fear is tiresome. It’s as if we’re in the horror flick where the victims chant, “Candyman…Candyman…Candyman…” into the mirror to summon the Bogeyman.

Only in this version, the bogeyman RPR comes crashing through the mirror to take our cooperation and compensation agreements if we don’t keep whispering “National MLS…National MLS…National MLS…” to keep it at bay.

RPR has contractually agreed to never become an MLS. MLSs have been consuming each other at the rate of around one every four days. 100 have disappeared in one year. How many has RPR replaced?

‘Coming soon’ listings

MLSs across the country are trying to develop “coming soon” statuses. It seems like a solution for a problem that doesn’t exist, but agents want another marketing angle. So MLSs are obliging.

Currently, any MLS could accept an active listing, allow for a restriction on showings for two weeks while the seller fixes things up (with a seller’s signed consent), and create the “coming soon” buzz without adding a new status for MLSs and standards developers to deploy.

If a new status is the hoop everyone wants us to jump through, though, we’ll probably do it. So let’s define it.

If the property is shown, it’s not “coming soon,” it’s active. If it starts as “coming soon,” then goes active, and one minute later goes pending, it probably wasn’t ever “coming soon.” It was active.

We can do “coming soon,” but only if we’re going to be honest about it — not to promote double-sides, in-house sales or preferred buyers.

Politics at midyear

There’s a lot of talk about tax reform. As we hit the hill in D.C., our message was as clear as ever. No matter the tax policy coming forward, it should incentivize investment in homeownership, much like we incentivize investment in health care, retirement and education. That’s a tough message in a D.C. atmosphere that’s very loud, but we’re still carrying it.

Some members want us out of politics, but today’s reality is that if you’re not at the table, you’re on the menu. We’ll be at the table for our industry.

Can the Voice for Real Estate come through a revolving door?

I’m a local association president. Our board’s CEO relays media calls and interviews to me. I appreciate the deference and the recognition it creates, but I can see how it weakens the continuity of our voice as an organization. The tradeoff is difficult to swallow.

At NAR, we hoist a new name up for the media once per year and hope that it sticks. This is our tradition, and it’s a great gift to our presidents, but it’s probably time to take a hard look this practice’s effect.

Our voice needs to recognizable to stay on top. Our new CEO, or someone she/he hires, needs to be consistently in front of the media.

Is the board too big?

Most dare not even whisper these words, as a position on the board of directors is a sacred cow, not to be touched. NAR has about 900 directors on its board. What’s the ideal size of the board? Maybe it’s exactly what it is today, but it shouldn’t be heresy to ask.

Our volunteer members do amazing work supporting leadership from the committee levels. Can we have a real, effective debate at our current board of directors’ meetings with our current size?

Our data divisions make us vulnerable

Realtor members have less than ideal access to our data. Between NAR data, nationwide MLS data and RPR data, we have the opportunity to meld these resources into an incomparable asset for use by our membership. Yet we let it sit in artificial silos to protect our territories.

Meanwhile, innovative data companies create tools to aggregate and repurpose such data while we sit on our hands and watch or, better yet, cut them a check to buy it back.

There’s a lot of distrust within our organization. While there are many reasons for it, they make us weak relative to outside forces.

Legacy

Multi-generational Realtors are often the most devoted and knowledgeable leaders. I’m continually impressed when I travel to events at the percentage of committed volunteers who are second, third or even fourth-generation Realtors.

Our incoming president, Elizabeth Mendenhall, is a sixth generation Realtor. There’s no replacing that institutional knowledge. Kudos to those of you who carry that torch.

MLS of Choice

I’ll introduce this topic with the moniker it has taken on in the media, but this issue’s logistics are significantly different than Board of Choice. Yet, its intent is similar: to serve broker and agent members with a better, more flexible service model. Giving brokers and agents more choices in the MLS services they pay for is the path forward.

We’re looking into ways to incentivize brokers to grow and join MLSs without cost prohibitive policies holding them back.

The issue is complex and I won’t attempt to define all of the parameters here. Just know that we’re working with all of the stakeholders — MLSs, brokers, agents, associations — and trying to find a policy solution that positions all groups to be prepared to thrive in a changing marketplace.

You can contact us with your stories, concerns, and suggestions at mls@realtors.org. We’d love your feedback.

Sam DeBord is managing broker of Seattle Homes Group with Coldwell Banker Danforth and President of Seattle King County Realtors. You can find his team at SeattleHomes.com and BellevueHomes.com.

Project Upstream: Tax Reform for Real Estate?

This article was originally published in Realtor Magazine:
by Sam DeBord

Business owners take risks to create valuable products and services. They drive the national economy and create jobs.

But no good deed goes unpunished. These entrepreneurs are rewarded with a slough of tax reporting requirements from a tangled web of government agencies. A single business might file fee or tax reports with its city, county, secretary of state, state department of revenue, licensing board, insurance commissioner, and the IRS.

Business owners often feel powerless, subject to countless mandates with no voice in the process. In an ideal world, the system would be reformed. A business would file a single revenue report that could be used by any agency, cut one check to the government, and get back to work. No one is holding their breath for that outcome.

Disjointed Real Estate Listing Distribution

Real estate’s convoluted listing system creates a similar feeling. Property listings, and the services that support them, are the revenue drivers of the industry. Making listing delivery efficient should be a priority. Yet a single listing might have to be input in a dozen different locations before it has been comprehensively distributed. The process doesn’t improve much after distribution. The listing creators often have little control or feedback regarding how their information is treated.

Brokers, agents, staff, and others waste valuable time entering the same listing data into multiple MLSs, vendor websites, franchisor platforms, and advertising portals. The data is the same, but each listing outlet requires a different process of delivery. It’s the definition of inefficiency.

Loss of Control, Uncaptured Value

Once delivered, the listings can take on lives of their own. Brokers and agents often sign on to agreements with little protection for their data rights. Advertising portals rework and manipulate the data and media as they see fit. Some go so far as to republish listing photos in unrelated advertising campaigns without credit or compensation given to the creators.

The single brokerage, on its own, has little ability to reform the process or negotiate a better contract. The inertia of the current system is too great. As a nationwide collection of brokers, though, a single voice like the Upstream coalition would have that power. It has the assets necessary to create a new process and the clout to motivate listing data recipients to operate on a more level playing field.

This, of course, is where fears of power consolidation reside. Tax reformers promote a streamlined system but are wary of granting a federal government agency greater powers to make it possible. Project Upstream’s goal is to streamline business and benefit the entire broker sphere. It will also be a place for brokers to manage a broad range of other kinds of information beyond listing data, including customer databases, vendor contacts, and agent rosters.

Its motivation, though, is the subject of conspiracy theories regarding elimination of small brokers and takeover of MLSs.

Us vs. Them, or All for One?

Luckily for real estate, the body with the power to streamline its processes isn’t the IRS. It’s a collection of “us.” The forces combining to support Project Upstream are the brokers who deal with the value-sapping quagmire of the current listing system every day.

These are business owners who represent over 70 percent of brokers nationwide (and growing). When we get past fear, the benefits of Upstream are fairly straightforward for brokers:

  • Eliminate redundant labor in listing input
  • Improve accuracy and timeliness of listing data output
  • Ensure broker control and choice regarding which outlets receive data
  • Establish broker rights and display rules over the data and media

Upstream’s challenge will be conveying this message to the individual. The project’s developers clearly understand the mission. Can that message be delivered in a way that motivates a broker or agent to change course in their everyday duties in support of a greater movement? Much like each individual voter must understand and believe in a cause to take the time to cast a ballot, adoption by the masses, one by one, will determine the viability of this venture.

Tax reform may be wishful thinking. Listing data reform, on the other hand, is right under our noses. There’s no czar or military coup attempting to seize power and take our autonomy from us. Brokers are merely creating better tools and more control for themselves.

Real estate brokers nationwide haven’t collaborated this closely toward a clear goal in quite some time. Let’s not allow conspiracy theories to cloud the way forward.

Sam DeBord

Sam DeBord is managing broker of Seattle Homes Group with Coldwell Banker Danforth, and 2016 president-elect of Seattle King Country REALTORS®. You can find his team at SeattleHome.com and SeattleCondo.com.

Will RPR fears hold back industry vision for Upstream?

This article was originally published on Inman News:

  • Upstream provides the model for broker-led data management, but the expense of RPR worries brokers.
  • Data management isn’t free. Brokers need to spend to keep up with portals.
  • Inaction based on past failures will only deepen brokers’ loss of control.

Broker conversations about data today usually take on a grim tone. That was the case when I recently moderated an industry panel of MLS and broker executives. The topic was the future of organized real estate, and the conversation was filled with worry that we (the broker-centric world) had lost the ability to manage and profit from our data.

Brokers and agents create the bulk of real estate’s valuable data sources, and then promptly give them away. Technology companies use the data, with few rules attached, and drive the majority of their revenue with it. They charge brokers to advertise adjacent to it.

This sentiment isn’t new, nor is it unique. It’s been around since the first portal website started charging for advertising. The message’s volume has been steadily growing, though. Its simple truths haven’t become any less true.

So when our panel’s conversation moved to the potential of Upstream to right the power structure in the world of real estate data, one would imagine the tone would turn aspirational, hopeful, or determined. It did not. While the concept clearly addressed our biggest concerns and drew significant approval in theory, the outlook was met with skepticism and distrust.

Skepticism’s roots

Unfortunately, this wasn’t a rare instance. Many of the industry folks whom I speak with about Project Upstream begin their conversations with wariness. There are well-founded concerns about the ability to bring such a diverse group of real estate companies together to make the project work.

By and large, though, the fears keep coming back to RPR.

Let’s get the bogeyman out of the way: RPR has cost the National Association of Realtors more than $120 million since its inception. That’s about $120 per member over its lifetime.

New annual expenses for RPR are around $22 million. They’re included in members’ dues (the Second Century Initiatives include RPR, HouseLogic, Real Estate Today Radio, .realtor domain, and eProperty data, at a cost of about $25 per member annually).

Maintaining RPR is a significant expense, one which many brokers feel is too large. It was built to be a revenue-producing tool, and it hasn’t become that. Although many Realtors across the country love and use the tool, adoption rates are still far too low.

Lack of access to MLS data in certain markets hamstrings its ability to provide profitable analytics products (its initial revenue model). Border wars between MLSs, brokers and vendors have created a maze of roadblocks to its adoption.

Moving forward

That $120 million is a sunk cost. It’s gone. RPR has been a failure so far as a revenue producer.

But it’s pivoting. We built a powerful tool, not realizing at the time what its most useful application would be: It’s ready to plug in to the data dashboard that brokers have been clamoring for.

The hottest topic at industry conferences is the desire to take back the management of our data. Unfortunately, many of the speakers get gun-shy when the tools are laid out on the table.

Ignoring how conspicuously RPR fits in to the model of broker-led real estate data management is playing the small game. Brokers are emotionally scarred by past ventures that didn’t go as expected, but we can’t let that drive us into a perpetual state of stagnation. If there’s one thing we can guarantee, it’s that marketing portals won’t be sitting still.

We must demand that RPR is run efficiently in the future as a facet of Upstream. The $20 million a year price tag is a big ticket, though it pales in comparison to the $50 million quarterly losses that advertising portals are taking on to secure a larger portion of the digital real estate pie.

The opportunity to shift the landscape of the industry’s data management isn’t free. Our leaders have to be aware of past mistakes, but not let them paralyze our will to take strategic risks.

After venting fears about RPR, our industry panel had one final related question:

“Considering that data management is the primary concern we’re voicing at the moment, is downplaying Upstream because of questions about RPR a signal that we’re OK doing nothing? Will we be sitting here next year with the same issues, or worse, if we don’t at least attempt to support Upstream?”

There was no answer. That’s because, frankly, we all knew it was the case. Our industry has many intelligent leaders with legitimate concerns about the path going forward. But the inertia of inaction in real estate is often scarier than the uncertainty of change.

Sam DeBord is managing broker of Seattle Homes Group with Coldwell Banker Danforth and 2016 president-elect of Seattle King County Realtors. You can find his team at SeattleHome.com and SeattleCondo.com.

Upstream and RPR: the smart grid to power the real estate machine

This article was originally published on Inman News:
by Sam DeBord

The negotiation, dissemination and confirmation of an agreement to build Upstream this past week between brokers and NAR’s board of directors was shocking in its speed. Virtually the entire broker sphere is on board. Upstream, with its newly unified backing, has the potential to alter significantly the power structure of the real estate industry.

To put the agreement in its simplest terms: The brokers representing the vast majority of agents nationwide support Project Upstream. Their goal is to create a broker-controlled gateway to all online display of real estate data with broker-specific rules attached. They’ve partnered with NAR to fund building that gateway with RPR — the largest parcel-centric property repository in the industry — as its database.

Brad Inman wrote this week that brokers are biting back at “the machine” of technology that wrested control away from them decades ago. He wondered if Upstream would be just another middleman.

As I watched the partnership solidify in D.C. this past week, it was almost bizarre to see this new power player emerge during a nonprofit trade organization’s annual legislative meeting. All outward appearances were that this was just another buttoned-down event designed for measured, process-driven political decision-making.

In reality, a group of executives and technology minds were seizing an opportune moment and wresting control of the industry’s conduit to the consumer world online. This new power player, the middleman that he might appear, was Michael Corleone eliminating his stunned opposition while attending a baptism. No one thought him capable of such swift and broad consolidation of power until it was too late.

Brokers and NAR can now create a smart grid to control the flow of power to any vendor, MLS or portal that is dependent upon broker data for viability. This isn’t just “taking our data back.” It won’t just allow brokers to decide where their data goes. It will define how, when and where much of that data is displayed and used at any end point.

The real estate tech machine has always been powered by a tangled web of broker data too disjointed to control. It looks like a Brazilian favela, with rogue users strapping their own data lines anywhere they see fit and supplying unreliable power sources to anyone with the willingness to plug in. We know it’s a risk to the end user, but no one has ever built the infrastructure to replace it all in an organized and fully funded way.

That can end with the smart grid dashboard of Upstream.

Brokerages can curate their data-driven content on a granular level if Upstream is built out as a flexible, powerful platform. A brokerage could deliver its full data set to an MLS, restricting the data to co-brokerage and IDX uses. Controlling its own syndication dashboard through Upstream, it could decide it only wants Portal A to receive five photos of each listing and require a linkback beside each to the broker’s website (driving direct contacts from consumers). Other portals, vendors and partners might be required to follow a different set of display guidelines based on their relationship with the broker. Each broker could form its own set of rules for each of its data recipients.

Broker experimentation with subsets of data and rules, displayed on different advertising outlets, will allow us to develop long-term analytics showing what kind of marketing actually sells homes. No longer reliant upon the vendor’s statistics, brokers will be able to develop rational models for marketing that are based on sales instead of impressions.

Upstream is a gift to relations between brokers and MLSs. It takes away the MLS’ need to syndicate, and it takes away the broker’s ability to protest. The MLS continues to provide the cooperation and compensation rules at the broker-to-broker level, while brokers are free to experiment with their consumer-direct advertising as they see fit. RPR has always had a noncompete with MLSs, so there’s no national MLS controversy.

It’s a massive coup for NAR. Brokers could have built Upstream on their own, but interbrokerage rivalries would have slowed the process significantly. Recognizing this as an industrywide watershed moment, they tabled their past disputes and added a unifying voice to lead it (and to fund it significantly). RPR was a financial drag in the past, but it looks like a product that was built to do exactly this. Pivot or not, it’s an ideal partner to jump-start the initiative.

When it all shakes out, access to more standardized, reliable data will be available to anyone willing to play by the rules. That might inhibit a few tech companies’ plans, but it’s a much-needed maturation for the industry’s data foundation.

Real estate’s utmost service value is to the transactional parties, not hobbyists or entertainment browsers. The people directly responsible for helping sellers sell and buyers buy could once again be sitting at the control panel that powers sales-related real estate data across the Web. That’s a good thing for our industry.

Sam DeBord is managing broker of Seattle Homes Group with Coldwell Banker Danforth and a director for Washington Realtors and Seattle King County Realtors. You can find his team at SeattleHome.com and SeattleCondo.com.

Zillow’s Agent Finder, Winter Lull, and The Wide-Open Future of Online Real Estate

This article was originally published on Inman News:

I had just finished writing a post about the lack of interesting consumer innovation this winter in real estate. Then, along came Zillow’s Agent Finder. It’s exactly what you’d expect: an attractive, easy-to-use interface that lets consumers see agents in a geographic location based on reviews, listings and past sales. Of course, there are also some spots up top for agents who are paid advertisers.

Are there holes in the data? Absolutely. Will consumers care? Probably not. Agent Finder feels like Yelp for real estate; it allows for positive and negative reviews, without interpreting the company’s financial success. Yelp makes consumers feel comfortable that even though they might not have all of the available information, they have enough to make a good decision. That’s the feeling Agent Finder might give to real estate consumers — comfort that they’ve been able to make a good choice, even if all of the choices might not have been present.

Agent Finder will still present an inaccurate profile of some agents because of the lack of comprehensive sales data, but it will do so with less antagonism than the stark ranking via production data that we saw in the past with Redfin’s Scouting Reports or NeighborCity’s scoring system. Much of the agents’ past sales data has to be manually input, ensuring that we’ll have a picture that’s skewed toward the Zillow-friendly agent. That will likely boost agent adoption of the platform. I could be wrong, but I don’t think Agent Finder will draw out the agent pitchforks in the way past ratings systems did. It will still have some agents justifiably upset at the way they’re portrayed.

Having been on the advisory board for realtor.com’s AgentMatch, Find A Realtor and NAR’s Realtor Ratings Committee, there’s a simultaneous feeling of frustration and admiration watching Zillow build a tool like this. We have the membership and the data to make it happen through NAR, but we move cautiously for our membership. Most tech companies ask forgiveness instead of permission.

There’s still an opportunity for NAR to build a more comprehensive, broker/agent-supported platform for Realtor reviews. A more robust database can win in the long run, but the consumer mind share for reviews is hard to get back after a certain threshold has been reached. Zillow is climbing that ladder quickly.

The business rundown

The business side of the real estate Web has been volatile. In just a few months, Zillow swallowed Trulia, realtor.com upended the new Z-appendage for the No. 2 traffic spot, and NRT started unearthing its much-misinterpreted Flanker project. Upstream and the National Broker Public Portal are gaining steam.

In 2015, if you utter any version of “Company X is here to stay” or “You can’t compete with Y,” you’re voted off the island. That mindset is so not real estate. Real estaters are the fiercely independent, never-stop-striving, scrappy Rocky Balboas of sales. The day our industry becomes pacified followers is the day a website should take our jobs away from us.

Captain Obvious: “Remember when we used to wear watches? And when realtor.com and brokerage sites dominated search rankings? Hahaha. That’ll never happen again … unless by some crazy chance there are genius billionaires who invest in technology and real estate.”

The strange thing with all of these investors making it rain in the real estate club is that the true innovation on behalf of consumers has felt somewhat stagnant for months (the new spring exception being Zillow’s Agent Finder). Everyone is increasing their ad spending, but few are building something that will make the average consumer say, “Wow! I bought/sold a home in a measurably faster and better way.”

The more traditional, complex and investment-heavy these top real estate outfits get, the more difficult they’ll be to overcome by joining the financial arms race. There’s so much good money being thrown after bad right now, though, that there seems to be plenty of space for smaller investors to do something unique and succinct at a reasonable price for consumers without trying to out-gorilla the big boys.

Project Upstream and the data integrity projects under the same idea umbrella have serious legs now. The non-geek crowd seems to finally be noticing that fair display guidelines and feed agreements are important. Unfortunately, many boards and brokers have been so deafened by their screaming agents that they missed out on this opportunity for real guidance when they signed the first portal feed agreements that were thrown in front of them. If you don’t know whether you’ve signed away the rights to your clients’ interior home photos in perpetuity to a marketing portal, you need to go freshen up on these topics.

The cultural reach

“Zillow Talk: The New Rules of Real Estate” was the best consumer real estate entertainment this winter, and it’s being quoted every 1.3 seconds by a real estate reporter. It’s strategic genius in terms of marketing and public relations. If there’s one thing Zillow knows, it’s consumer attention.

The book’s takeaways are pop culture shareable trivia like those in “Freakonomics.” There are a mix of interesting insights, such as how to pick the next up-and-coming neighborhood. There are also some cringeworthy statistics-turned-sound bites that you’re going to undoubtedly hear at cocktail parties in the future.

One such revelation: The words you use in your listing description can cost you money. “Luxurious,” “impeccable” or “spotless” in a listing description results in a higher-than-expected sale price on average, while “fixer,” “TLC” and “investor” point to a lower-than-expected price. The Zestimate is the “expected price” that you’re probably asking yourself about, which is as appropriate as calling a child with an American Girl doll an “expectant mother” — but I digress.

Captain Obvious: “So you’re telling me that when the real estate agents, who actually saw the property, specifically tell us what condition the homes are in and use words that mean good condition, it will result in higher values than words that mean poor condition? Genius!”

You can’t fault Zillow for playing the statistical click-bait game with the consumer entertainment topics. The reusable content is pure gold for media relations and will drive traffic and brand building. Just ask Buzzfeed. It’s less attractive when easily refutable statistical analyses are lazily used to suggest policy changes, such as restricting the mortgage interest deduction.

The hopeful future

The National Broker Public Portal hit its initial funding goal of $250,000. The prognosticators will say it’s an insignificant number; that if the portal can’t match Zillow or Move in funding, it can’t compete — poppycock.

Name whichever company you’ve attached the term “disruptive” to this week, and ask yourself if it became successful by outspending gigantic traditional competitors on advertising. It’s true that the NBPP has a long way to go in attracting consumers, but outspending others on advertising is a lost cause. Delivering a proprietary, crystal-clear tool to consumers, on the other hand, makes organic growth just one good idea away.

Ask Homesnap. With what looks like less than $10 million in total funding, it’s a top five consumer app that wants to drive its growth by joining with brokers and MLSs — much like NBPP would like to do. Homesnap is leveraging agent/broker/MLS connections to build support from the industry floor upward. In the markets where it has signed up seven of the nation’s 20 largest MLSs, as far as consumers and agents on mobile are concerned, Homesnap’s MLS app is the MLS.

The silly little tool that lets consumers snap a picture of a home and pull up its data is just a gimmick based on GPS and a gyroscope, right? It couldn’t be that Homesnap is building an unmatched database of millions upon millions of photos, taken by consumers, of real estate with GPS coordinates and public records data attached. There’s no way to compete with the biggest boys without hundreds of millions of dollars. Nothing to see here, move along.

Sam DeBord is managing broker of Seattle Homes Group with Coldwell Banker Danforth and a director for Washington Realtors and Seattle King County Realtors.

Upstream & The National Broker Public Portal: Unearthing, Creating Super-MLS Data Layers

This article was originally published on Geek Estate Blog:

Upstream, Broker Portal, and MLS DataProject Upstream aims to become the defender and gatekeeper of brokers’ real estate listings nationwide.  The National Broker Public Portal intends to provide a nationwide display of data that puts brokers at the controls.  The former is not intended to exclusively fuel the latter (though it seems like a match made in heaven–more on that later).

Upstream is not an MLS and will not replace the MLS’s co-broker, commission, and professional standards roles.  Its creators do not intend for it to be public-facing on its own.  It’s intended to feed many portals with standardized data.

Upstream and the National Broker Public Portal are projects about advertising online to the real estate consumer. Accurate data and fair display guidelines are important to brokers.  Based on consumer traffic numbers to certain portal sites, consumers don’t seem to care as much about the same issues.

Brokers need to achieve their goals by creating their own vision of perfected data display, while simultaneously building an attractive platform that consumers will not only approve of, but proactively search out.

Differentiation on a level that consumers can easily and quickly understand will be key to gaining a significant market share at a price that’s attainable.

To differentiate in the consumer space broker projects need unique data layers that are only available to brokers.  They can create them by:

1) Reworking the proprietary data they already have, or

2) Generating entirely new layers of data that accompany any new listing that enters the marketplace through their gateway.

Unearthing another layer of current listing data

When we say the portals have “access to MLS listings”, we’re really talking about just a small subset of listing data.  Portal advertisers show the basic listing data, and surround it with other data from publicly available sources.

An Upstream-type gateway could require its members to give broader access to their listing data fields in return for being a part of this new unique consortium of data providers.  By allowing more data fields into this sole repository to become publicly displayed, a preferred portal that is allowed to display this data can claim a truly unique identity.

Just one example of data that might be leveraged for unique consumer content:  keybox history.  The preferred portal might be able to display:

  • The number of showings for a property
  • The rate of showings
  • The days in which the property gets the most activity
  • Aggregated showing data across neighborhoods and cities
  • Heat maps on Sunday traffic for house hunting
  • Which neighborhoods are trending upward
  • Which ones are lagging and have better potential for discounts on prices

That’s just one facet of listing data that’s currently behind a shroud.  We could think of another half dozen in an hour.  An initiative to expose this kind of data on a single website would have immediate consumer impact.

Creating a New Layer of Super-MLS Data

If an Upstream-style project really gained ground as the starting point for listing input, why not give the option, or potentially the requirement, that new listings on this data source add new fields that might not have existed at the MLS level before?

Imagine requiring every single listing entered on Upstream to include a legal description, a floorplan, a permit history, or a 3D-model of the home.  Think of the value of a Super-MLS layer of data that added the kind of consumer-viewable documents and features that can’t be found anywhere else online and can’t be reproduced through public data sources.

Of course these things would have legal and financial ramifications, but the point is not that the examples given are the specific answers.  The answer itself might not be apparent today, but the ability to provide a listing with a totally unique display layer, one that isn’t available to any other advertiser, is riveting.

Why would it work?  The company inputting the data has 1 million data entry staff members.  

Agents are the data creators.  Even a well-funded portal’s engineering army is a fraction of the size of the agent masses creating unique content on a property-by-property basis.

When the data gatekeeper becomes the de facto starting point for the industry, whatever new layers of proprietary data have been added to the listing input fields will become the standard of operation.  The listings could still be fed to MLSs for B2B/IDX/co-brokerage functionality, while a single consumer portal which is allowed to be the sole national display vehicle for these new layers would be able to hammer its opponents over their heads with this Super-MLS listing data.

Get To The Point Or Go Back To Work

The conversations we’ve had about portals selling our data back to us have been long on what brokers want.  They’ve always been short on how to realistically get those things in a consumer advertising market, which is far more important.

If brokers want to create better data, and display it in a superior way, they should focus first on who will pay attention.  Ask what new things can be done with the proprietary data they already have.  Add on a layers of new proprietary fields and make them a feature or a bonus for the agents who input them–an opportunity for their listings to stand out, not just to do more work.  Create a reason for consumers to fund the project(s) through traffic going forward.

By unearthing hidden listing data and creating new Super-MLS layers, you might just have the kind of data that consumers can’t get enough of and that a portal could benefit financially from in a big way–and that’s where the data creators start taking their leverage back.

Sam DeBord is a former management consultant and web developer who writes for for Inman News and REALTOR® Magazine. He is Managing Broker for Seattle Homes Group with Coldwell Banker Danforth, and a Director for WA REALTORS® and Seattle King County REALTORS®. You can find his team at SeattleHome.com and SeattleCondo.com.

The National Broker Public Portal: Simplicity, Differentiation Are the Paths To Success

This article was originally published on Geek Estate Blog:

Simplicity - Broker Public Portal
Image via Heinz Marketing

There has been a lot written about the possibility of a national Broker Public Portal for real estate–probably too much, for a project that’s nowhere near being off the ground yet.  Still, the idea rallies the spirits of many brokers, so it has legs.

The hurdles in front of the project are massive, and they shouldn’t be ignored.  They should become the focus of the project.  Its success will not be driven by trying to overcome them, but finding a way around them.

A member-led organization funded by part-time participants will always be severely hamstrung when competing against investor-fueled public technology companies.

Drew highlighted many of the obstacles to BPP’s success, some of which would call into question whether the project is even worth beginning.  Some of the best (synopsized):

  1. Once the 7.6-12.5 million is invested (initial website build), what is going to be invested going forward and where is the money going to come from?

  2. Is there a defensible moat that would make this an interesting business?  Up to date listings is not enough by itself.

  3. Technology providers in the real estate industry can build technology – but that doesn’t correlate to a great consumer product.

1. Let’s start with the money.  BPP would be best to accept that it will not outfund the Zillow Group.  It won’t outfund News Corp/Move, either.  It has to do something nimble, simple, and creative that doesn’t require building the massive, complex technical project that the big 3 (or 10) already have created.

2 . Up to date listings are a key differentiator, but they are clearly not enough to stand on their own.  They should be a big component of the value proposition, but building the next attractive bauble that draws consumers to the site will be necessary.

3. Real estate industry insiders are not consumer software developers, by and large.  They shouldn’t attempt to become better at building a complex nationwide product than the portals.  They could hire a team to compete but, that again would be oppressively costly if it were done at a competitive level to a Move/Zillow team.

So, don’t start building what has already been built.  Create the next zestimate.  Find that little shiny object that makes a consumer say “I want this.  I’m going to show it to my friends.  They’re going to want it, and we can’t get it anywhere else.”

What do brokers, and real estate insiders, have access to that public portals do not currently?  How can that be molded into an attention-piquing, conversation-starting, unique proprietary product that draws massive consumer-initiated traffic organically over time?

Think Drudge Report.  Think iPhones opening keyboxes.  Think On-Star in your vehicle.  Start out with a wide open mind to what your industry has its tentacles attached to, and then find niches that no one else has yet exploited.  Stick to simplicity, and draw traffic based on the unique assets you create.  Don’t try to build every restaurant in Manhattan at the same time.  Just build the delivery service that gets food to the consumers more quickly.

There must be dozens of great, simple, scalable product ideas that could be derived from a big group of industry trailblazers, based almost wholly on the technology they already own.  I’d be lying if I said I didn’t already have my own.  Having access to broad, clean data will be ultimately important.  Continuing to build the structure of the BPP organization will be necessary, but developing a product that’s unique enough to be worthy of such a grand support structure should come very early in the process.

The process of building a national broker public portal will be slow.  For it to get anywhere, the participants need to be motivated by more than fear.  They need a visible, unique, attractive product to unite behind.  They need a project that seems financially viable.

Consumers don’t adopt portals.  They use tools.  Whether those tools provide entertainment, news, education, or efficiency, the brands that provide the tools consumers value get their loyalty.  By developing that simple, nimble idea for a tool or product that differentiates BPP’s brand value first, it just might have the vision that gets brokers and consumers jumping on board in quick order.

Sam DeBord is a former management consultant and web developer who writes for for Inman News and REALTOR® Magazine. He is Managing Broker for Seattle Homes Group with Coldwell Banker Danforth, and a Director for WA REALTORS® and Seattle King County REALTORS®. You can find his team at SeattleHome.com and SeattleCondo.com.