IDX and VOW…More Questions Than Answers

These Issues are more Complex than you might at first imagine

?Much to consider by all interested in MLS

The time to participate at the local level is Now

"There is a tide in the affairs of men,

Which, taken at the flood, leads on to fortune;

Omitted, all the voyage of their life

Is bound in shallows and in miseries.

On such a full sea are we now afloat;

And we must take the current when it serves, or lose our ventures."

...Shakespeare, Hundreds of years ago

Saul Klein, 2002

?

MLS Traditional Role

?Unilateral Offer of Compensation

?Collects the Data from Listing Brokers

?Compiles Data – Insures uniformity

?Disseminates Data

?Polices the Data

?

Why is IDX/VOW Important?

Unfettered Access of MLS Data by the Public through the Internet could have far reaching effects on the real estate Industry

Perspectives…

?MLS Provider

?Broker

?Agent

?Vendor

?Consumer

?Regulator

Many Aspects of IDX/VOW

?Legal

– License Law

– Copyright

?Privacy

?Marketing

?Technology

Advertising or Information?

What constitutes Advertising?

What is merely Dissemination of Information?

?

IDX

?Advertising another broker’s listing with the permission of the listing broker

?Consumers conduct searches from MLS Subscriber web sites

?Displayed fields are limited

?nbsp;nbsp;nbsp; Web sites offering IDX give the public the ability to conduct searches of listings, displaying data fields agreed upon at the MLS level by MLS Participants.

?nbsp;nbsp;nbsp; Participants can only display listings allowed by other participants (opt in or opt out).

?

Internet Data Exchange (IDX)

Distinction:

Data displayed is considered to be advertising.

How is Advertising defined and by whom?

California Commissioner Regulations

(a) Advertising--Any written or printed communication, or oral communication made in accordance with a text or outline that has been reduced to written form, which is published for the purpose of inducing persons to purchase or use a product or service.

?

ARELLO – Association of Real Estate License Law Officials

?

Advertising:

All forms of representation, promotion, and solicitation disseminated in any manner and by any means of communication to consumers for any purpose related to licensed real estate activity

?

VOW

Providing information via a web site to a prospective buyer about properties that prospect may be interested in purchasing.

No permission required by the listing broker as it is not advertising and requires some “relationship” be established

?All listing information details can be displayed, including comments, Seller’s name, Address (so the theory goes)

? The visitor, by virtue of onsite registration, becomes a client

? VOW is the same as a “Bricks and Mortar” office (theory)

? Subject to MLS Rules (Rules have yet to be written)

?Public, by providing contact information (non standardized as to amount and type), can conduct searches of all MLS listings.

?Participant can (arguably) display all MLS listings without permission of listing broker.

Virtual Office Web Site (VOW)

?

Distinction:

Data displayed is considered to be dissemination of information.

IDX/VOW Summary

IDX – Advertising

VOW – Dissemination of Information

----------------------------------------------

IDX – Listing Broker’s permission required

VOW – Listing Broker’s permission not required

Perspective - MLS

? Data integrity

? Currency

? Security of Data

?Copyright

Perspective - Brokers

Listings have “Marketing Value”

Should that value be used to:

?Attract Buyers and Sellers to a competing broker who may:

?Promote reduction of fees?

?Attract Buyers to FSBO Properties?

Perspective - Agent

?May want listing content for nbsp; their web sites

?Is Broker’s permission required?

?

Broker Supervision

A broker shall exercise reasonable supervision over the activities of his or her salespersons. Reasonable supervision includes, as appropriate, the establishment of policies, rules, procedures and systems to review, oversee, inspect and manage:

(a) Transactions requiring a real estate license.

(b) Documents which may have a material effect upon the rights or obligations of a party to the transaction.

(c) Filing, storage and maintenance of such documents.

(d) The handling of trust funds.

(e) Advertising of any service for which a license is required.

Perspective - Consumer

?Want all the information for nothing

?Listing Information is not “Public Domain”

?Consumer should be entitled to only that information brokers are willing to provide.

?Consumers have no automatic “right” to free listing information just because there is an Internet.

Information is not “free” to subscribers who pay a monthly/quarterly fee for access to the Information (compiled, cleansed data)

Regulators – Must insure compliance with existing laws and may determine that what some consider the providing of information is in fact advertising, subject to current advertising rules which includes the requirement of permission from listing broker

Legal Issues

How is IDX/VOW viewed by state regulatory bodies?

Make sure your solutions comply

?

Procuring Cause

?Who starts that unbroken chain of events that ultimately leads to a sale?

?Does IDX or VOW create new scenarios?

Possible VOW Rules

?Permission of seller – Do sellers have any privacy rights or say so in the decision as to whether or not their names should be included on the Internet?

?Name of Listing Broker - should it be provided?

?Search Criteria or limitations – Should there be limits to the amount or type of properties searched for

?Should property search be limited to amount buyer qualifies for (by filling out a loan prequel form)??

?What Status or types eligible for display?

–Active Listings

–Pending

–Sold

?Property Address – should it be included?

?

MLS Role

?Unilateral Offer of Compensation

?Collects the Data from Listing Brokers

?Compiles Data – Insures uniformity

?Disseminates Data

?Polices the Data

Searches

MLS - Agents Search

VOW/IDX – Consumer Search

Does intent or design of MLS include the ability for consumer search?

Why not just give consumer your MLS User Name and Password?

What do the following have in common?

e-BAY

Yahoo

e-REALTY

Zip Realty

HomeGain

What do the following have in common?

Could it be…

Your Listings

What is the marketing value of a listing?

Listing information is not public domain

Listing information and the listing contract have value

Do you allow other brokers to place their signs on your listings?

What is the marketing value of a listing?

Should a broker’s Listings be used to:

?Sell someone else’s real estate services

?Be used to promote another business model offering services for lower fees than you charge?

?Draw consumers to FSBOs – examples are available on the Internet

Public Access to MLS

?MLS was not created with the intent that consumers should have access to all the content

?The “first wave” of public display required fields to be agreed upon by participating brokers

?The argument centered on “who owned the data”

?

Justification for Unfettered Public Access by Web Surfers

?Client copy does not contain name of listing broker

?Internet is just a new way to provide information and is no different than having someone come into your office for information

Justification for Limiting Access by web surfers

?Too many properties to choose from is confusing

?Certain information contained in an MLS is confidential and compromising it could put the seller at a negotiating disadvantage, violate privacy, put people at risk (physical)

?A VOW is not the same as a “Bricks and Mortar” Office so different rules are necessary

?MLS allows for agent search, not consumer search

?Certain MLS information is confidential

–Remarks

–Addresses

–Seller’s name

Justification for Limiting Access by web surfers

?Listings have Marketing value and brokers should have the ability to opt in or out.

Thoughts

?Brokers do not allow other brokers to place for sale signs on their listings so they should be able to decide if they want the marketing power of their listings to help their competition market and sell current and future services

?Listing information is valuable and brokers can still be in control…just because there is an Internet does not mean brokers have to give up control of listing data

?Sellers should have the right to opt in or out

?There is no evidence that the property the buyer finds in an Internet Search is the property the buyer purchases…in fact, the property purchased is probably the property found by the agent in an agent search

?Surveys are suspect anyway

?Agents should only be allowed VOW or IDX sites if their brokers approve

?When someone comes into your office, do you give them your user name and password to the MLS. If not in your office, why would you on the Internet?

Complications

Much to consider by all interested in MLS

The time to participate is Now, at the local level by all interested REALTORS?

There is a tide in the affairs of men,

Which, taken at the flood, leads on to fortune;

Omitted, all the voyage of their life

Is bound in shallows and in miseries.

On such a full sea are we now afloat;

And we must take the current when it serves, or lose our ventures.

...Shakespeare, Hundreds of years ago

Saul Klein, 2002