Sharing

Brokers and their agents are always trying to find better ways to serve our clients.  Over a hundred years ago the members of my profession would gather on a regular basis to share information about their new listings and they had agreed to split the commission with another broker if they could bring them a buyer.  It was the beginning of the Multiple Listing Service, a phrase created somewhere near the end of the nineteenth century.  During the first half of the twentieth century, the process became more formalized.  But when I first started in real estate in 1991, commercial agents and brokers in my area would meet for breakfast every Tuesday morning at the local Denny’s.  I would sit in awe of those agents as they would broker deals.  A gas station would be sold for money, a boat, and a duplex.  Did anybody have a lead on an industrial site?  A client of another agent was looking for tear-downs.

In some ways agents still conduct business like this.  We get together weekly to see the new listings and discuss what our buyers are looking for.  We all know that our clients are better served when we share information.  To the outside world it looks as though we eat, sleep, and drink real estate.  What we are really doing is looking out for our clients.

Multiple Listing Services eventually became separate entities from the Realtor boards that created them.  They eventually published books each week with the latest information.  In the nineties we went computerized.  The information, however, was still input by someone at the MLS.  Here in Southern California we have what is called a “broker loaded” MLS.  That means that the information is loaded by the broker or an authorized licensed agent.  We keep tight controls on just who has access and we fine agents for not following the rules.

Most Multiple Listing Services are Realtor owned, but not all of them.  Only those that are Realtor owned automatically load into the Realtor.com website.  The site has been up and running for several years now with great success.  The public information portion of our listings can now be viewed by millions of people around the world.  It has become a valuable tool for agents and brokers.

But success breeds jealousy.  Realtor.com and its power are coveted by those who are not necessarily interested in maintaining its integrity.  To be an agent requires education and training.  To become a Realtor one must adhere to an ethical code.  To place an ad in a Multiple Listing Service you must be both a licensed agent and a member of the National Association of Realtors.  Do it yourselfers would like to skip those requirements and utilize an industry tool that has taken over a century to create.

To this end the FTC filed suit over a year ago against 7 MLS’s for anticompetive conduct.  Several of the services just gave in.  But a Detroit area MLS decided to fight.  On Thursday, the FTC ruled against itself.  The bottom line for the FTC is how well is the consumer served?  By not allowing For Sale By Owners to use the local Multiple Listing Service is the consumer, in this case a buyer, hurt?  No, said the judge.

I would argue that allowing FSBO’s to use the MLS would hurt buyers.  Contrary to popular belief, the vast majority of our profession is concerned with fairness and honesty.  We are held accountable for our business practices by others in our profession, by our national, state, and local Realtor’s associations, and by the state and federal government.  Owners selling on their own are only accountable to state and federal laws, if someone files a complaint. They are not audited as we are.  They are in it for the one deal, not for a career.  It is one thing to share between professionals; it is another to allow armatures to take over an industry tool.  If that tool becomes unreliable, then everyone looses.

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