NAREP forms to fight abuse of the 'Big 3' in Listing Syndication

By
Real Estate Agent with RE/MAX Suburban - Schaumburg IL Real Estate - Northwest Suburbs of Chicago
http://actvra.in/JVP

NAREP forms to fight abuse of the 'Big 3'

NAREP was just newly formed to address the widespread backlash among real estate professionals who are frustrated with controversial practices by a growing number of real estate marketing websites. These sites rely in large part on listing data syndicated to them from local multiple listing service (MLS) databases nationwide.

NAREP, a non-profit organization based in Texas, aims to challenge Zillow,NAREP, Trulia, and Realtor.com with its own non-profit business model.  Once NAREP achieves membership representing twenty-five percent of the real estate listings nationwide, NAREP intends to coordinate its members to cease all syndication and sharing of their listings to non-MLS websites.

"This action will eliminate a major portion of the inventory on Zillow, Trulia, and other such sites," according Ben Caballero, NAREP's co-founder and chairman. Caballero was the top individual real estate professional in the United States for 2010 and 2011, as measured by unit sales and dollar volume, with more than 4,500 home sales exceeding $1.2 billion in total value.

"For NAREP to achieve a critical mass of listings, we will need broad support among real estate agents and brokers," said Caballero.  "We are just getting started, but our pre-launch exceeded our expectations. Our reception has been overwhelmingly positive."

"Businesses such as Zillow and Trulia, in their effort to profit from real estate professionals, display MLS listings, yet many of them are outdated or duplicated. Some listings on their sites do not even have addresses," said Caballero.

An industry study released last week by Redfin concluded that about 36 percent of listings shown as active on Zillow and Trulia were no longer for sale in the local MLS, compared with zero or near-zero percent for the listings shown on brokerage firm websites.

NAREP,"This inaccuracy on Zillow and Trulia is a rather dubious practice," said Caballero.  "They ought to remove the inactive listings as quickly as they insert them. They insert new MLS listings within days, but can take months to delete them when they are no longer available.  Brokerage sites manage to purge them quickly, so why can't Zillow and Trulia? Of course, the more pages Zillow and Trulia have on their sites, the more opportunities they have from organic search engine traffic to generate revenue.  I have no doubt their slowness to purge expired listings is a deliberate strategy. If you believe they have a different reason for doing so, then I have some valuable swampland in central Florida I'd like to sell you."

NAREP's position is that in their haste to generate income, Zillow, Trulia, and other websites have diminished the credibility of real estate professionals by "misleading, confusing, and frustrating consumers," said Caballero.  NAREP aims to launch its own national real estate listing website, complete with all MLS listings nationwide, to resolve the controversial issue of listing syndication that has caused concern within the real estate industry.

Effective October 11th, 2012 NAREP is officially accepting registrations for membership on its website, www.narep.net.  In coordination with its membership, NAREP intends to focus its energy to create a national website that will replace or greatly reduce the relevance of the growing number of real estate marketing websites that rely on MLS listings to generate income.

The NAREP listing website will conspicuously display the listing agent's contact information next to each listing at no cost, so that consumers can contact the agent with the most knowledge about a property.  To ensure accuracy, NAREP's website will use and regularly update data exclusively from local MLS databases.  To participate in the new website, NAREP will require its members to discontinue syndication and sharing of their listings to all websites that are not owned or operated by an MLS or their members.  Zillow, Trulia, and REALTOR.com do not meet this criteria.

AG Beat

 

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Re-Blogged 5 times:

Re-Blogged By Re-Blogged At
  1. Alan May 10/12/2012 11:46 AM
  2. Greg Nino 10/12/2012 11:55 AM
  3. Brenda Mullen 10/12/2012 12:34 PM
  4. Miriam Bernstein, CRS 10/14/2012 09:59 AM
  5. Chris Ann Cleland 10/21/2012 12:17 PM
Topic:
Real Estate Sales and Marketing
Location:
Illinois Cook County
Groups:
Bartender, Make it a Double
BananaTude
Realtors®
Active Rain Newbies
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Tags:
listing syndication
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Rainer
81,108
Michael Clarkson
Snow Coast Real Estate - Littleton, CO

And Zillow (and I also think Trulia) advertise on ActiveRain.  How many of you have complained to ActiveRain and petitioned them to stop selling ad space to Trulia and Zillow?

Lyn:  Re - Syndication:  I actually look at their syndication as free advertising...my job is to get my seller's home sold.  Where Zillow and Trulia get their bigger bucks is from the fees from REALTORS® (lead sales). 

Sure, I'll use them to get more traffic on my listing. But paying them directly?...forgeddabouddit!!!

Here's why I don't see this as hypocritical, there are two separate businesses:

  1. Web-marketing of listings and selling ad space on the website
  2. Inside sales/outbound telemarketing - selling leads to brokers.

Their business will collapse if we just take from them (free marketing of our listings), and then don't feed them with our direct marketing dollars. 

After all, who's going to sell them a home? A broker.  So, they can't insinuate themselves into that lead business, unless we let them.

Do you think they want to be in the brokeage business? No.

Do you think they want to be in the webmaster business? No.

Step on their oxygen hose by stop buying their leads...and they will starve on the other side of the business.

 

Oct 13, 2012 09:56 AM #44
Rainmaker
236,521
Mark Montross
Catamount Realty Group - Burlington, VT
Listing and Buyer Specialist

Wow, I knew that the number was high, however 36% outdated listings on Trulia an Zillow seems like an unbelievable number. I wonder how accurate that number is.

Oct 13, 2012 10:03 AM #45
Rainmaker
42,739
Sharon Denning
Red Mountain Realty - West Richland, WA
Marketing that gets it SOLD

Trulia and zillow rely on listing agents to pull old listings. Many do not as it is one more chance for someone to call them. Of course that house is gone but we can help you get up to date information..... 

Agents are part of the system, often times using postlets which syndicates to zillow and trulia. Does anybody think that zillow puts out a free tool out of the goodness of their heart?

Oct 13, 2012 10:26 AM #46
Rainmaker
1,397,379
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate

Thanks Lyn this is the first place I heard of the  National Association of Real Estate Professionals (NAREP.) I visited their site.  I also found the press release.

Odd that they would use the same initials as the National Association of Real Estate Publishers.  That NAREP (real estate publishers) has the .org   domain...  Also there's the National Restoration Party (NAREP), a Zambian political party, probably less confusion with that group being a whole other nation.

This will be interesting to watch.

Oct 13, 2012 10:29 AM #47
Rainer
81,108
Michael Clarkson
Snow Coast Real Estate - Littleton, CO

Lemme share with you some interesting stats that back up my assertions about the REALTOR® communal suicide that is taking place. 

ALL YOU HAVE TO DO IS STOP PAYING THEM FOR LEADS AND THEY COLLAPSE!!!!!!!  To wit:

http://www.inman.com/news/2012/09/26/zillow-responds-criticism-business-model

But Zillow "generates virtually all of its revenue from U.S. real estate agents," the report noted. "And it does so the old fashioned way: By cold-calling them on the telephone."

According to Zillow's last quarterly report to investors, the company had 22,696 paying "Premier Agent" subscribers at the end of June, up 70 percent from a year ago.

But the report notes that growth in Premier Agent subscribers has slowed, and claimed Zillow "is buying revenues with an intense telesales effort. Put in its simplest terms, they spent an additional $3.8 million on sales expense last quarter, and only generated $4.8 million in new revenues."

Selling leads to real estate agents "is a dead-end business," the report asserted, citing Zillow's recent moves to offer customer relationship management tools and enter "other businesses such as rentals, that have little to no synergy with their current business" as evidence.

The Citron Research report also focused on sales of stock by a few of Zillow's managers during the company's recent secondary offering, which netted the company $156.7 million after expenses.

 

A separate analysis:

http://1000watt.net/2012/08/trulia-s-1-filing-shows-optimism-raises-questions/

Finally, I’m not certain residential resale real estate can support three large online companies over the long term. Right now, based on their current revenue run rates, Trulia, Zillow and Realtor.com are taking about $400 million from the “Realtor wallet” each year. And while you hear lots of big numbers about the market opportunity (Trulia cites a recent Borrel report that pegs residential real estate ad spending at $23 billion per year) the reality is less grandiose.

The number of agents who are able and willing to buy online ads or software is probably only about 200,000.


So, "lemme" ask you: How do think 4 sites will fair?

Forget NAREP and just STOP BUYING THEIR LEADS...THEY WILL DIE ON THEIR OWN.

Oct 13, 2012 10:30 AM #48
Rainmaker
843,539
Lyn Sims
RE/MAX Suburban - Schaumburg IL Real Estate - Northwest Suburbs of Chicago - Schaumburg, IL
Schaumburg Homes

Sharon:  Z just bought Postlets not too long ago. I think it is a good product for us to use. You CAN uncheck those boxes on where you want it syndicated too.  Just saying you have to pay attention to this stuff .......

Michael:  Thanks for those stats. PLEASE READ THE STATS IN #48. Interesting facts that we should be paying attention too.  Thanks for running with that. 

Oct 13, 2012 10:42 AM #49
Rainmaker
843,539
Lyn Sims
RE/MAX Suburban - Schaumburg IL Real Estate - Northwest Suburbs of Chicago - Schaumburg, IL
Schaumburg Homes

Michael #44 - Yes, (hanging head down with sadness) I have not thought about contacting AR about Z. Has anyone else done so? 

I like the stepping on the oxygen hose analogy ......

Oct 13, 2012 10:46 AM #50
Ambassador
1,113,094
Melissa Zavala
Broadpoint Properties - Escondido, CA
Broker, Escondido Real Estate, San Diego County

I listened to the big syndicators speak at Inman in August and it really opened my mind. (As stated in the comments, if you stop feeding the monster, it may eventually die.)

Oct 13, 2012 01:30 PM #51
Ambassador
1,114,535
Bryan Robertson
Catarra Real Estate, Inc - Los Altos, CA
Broker, Author, Speaker

I hope these guys are successful.  I'd like to see the syndication sites disappear in favor of the more accurate MLS sites.

Oct 13, 2012 08:35 PM #53
Rainmaker
134,415
Paul Francis
Francis Real Estate Group - Las Vegas, NV
Las Vegas Real Estate - Summerlin Homes - 702.592.

All of the consumers are on Trulia, Zillow and Realtor dot con? Well... do some searching around in the search engines and you'll see why.

With a gazilion listings, pages and links pointing to them.. they are ranked as the authority sites and come in at the top of most major key words you type in for a search engine.

Search for Homes in "City Name"

"City" Real Estate... etc, etc..

Whatever it is that a consumer types in... more then likely it's one of these three coming in at the top of the search engine results for anything that actually draws traffic in.

Pay the $200+ bucks a month and you can get listed on there as a Premier agent or whatever ... even if you've never sold a home before.

Yay!

"They are a "featured agent" so they must be good because I saw it on the internet!" Lol..

You can spend all of the time and money you want on your own website but the big three are still going to get the major rankings. This was all warned about years ago with those stupid badges all of the agents were putting on their sites to link to these sites sending them link juice... Throw in the automatic listing syndications they bought from the boards (funny.. the prices I have to pay to be a member of these boards has only gone up!) and you have the results you see today.

Sadly, real estate agents did it to themselves when they let the Trojan Horses in.

Old Listings being listed? So what.. The big 3 can easily clean out their old listings and they'll still get all of the search engine traffic as long as the automatic (and forced) syndication continues.

It won't be long until they are major corporations with a staff of Attorneys sending out Cease and desist letters to agents calling them out, threatening litigation or buying off MLS boards, etc, etc..

Oct 13, 2012 10:46 PM #54
Rainmaker
700,772
Patricia Feager, MBA, GRI, Cert Negotiations Expert, Military Relo Prof
Dallas Premier Keller Williams Realty - Dallas, TX
The Little REALTOR® That Could

Lyn,

I haven't heard about this here in Texas yet. I'll let you know if I get any updates.

 

Oct 14, 2012 05:05 AM #55
Rainer
2,443
Ben Caballero
National Association of Real Estate Professionals, Inc. - Dallas, TX

Dear Colleagues,

I’d like to address the questions and comments posed by Bill Travis of Captain Bill Realty in his posts #34 and #42.

Regarding his comment on agents' not having a way to opt-out of syndication to specific sites such as Zillow, listing syndicators ListHub and Point2 offer dashboards that allow agents and brokers to opt-out of sending their listings to specific websites.  This will allow franchisors like Realogy to maintain their syndication websites, yet restrict listing data from going to ZTR etc.

The difference between NAREP and the ZTR etc. websites is that NAREP is a non-profit that is organizing as a 501(c)(6) trade association under the IRS code. NAREP will be governed by real estate professionals, and not by e-commerce professionals and venture capitalists who are looking to make fortunes on the backs of real estate agents.

When agents with +/- 25% of the national MLS inventory sign up with NAREP, we will launch a network of local IDX websites, much like RealEstate.com, except each listing will have the listing agent’s contact details and a lead capture form next to it. The only cost will be a nominal fee of approximately $10-$20, charged to the agent at closing only when -- and if -- the home sells.

Mr. Travis also posed the question, "Won't Zillow, Trulia, etc. also be MLS websites?"  I don’t see that happening unless ZTR each become a REALTOR® and join the MLS in each local market. That would be a complete departure from their current business model, as it would require them to conform to the MLS rules, which prohibit comingling MLS listings with non-MLS listings.

Please remember to register your support by signing-up with NAREP at www.narep.net. You can also follow us on Twitter and LIKE us on Facebook. (See links below.) We need your support to succeed in this effort! Registration is free and will enable us to keep you informed on NAREP's progress to end listing syndication abuse.

Sincerely,
Ben Caballero
Co-Founder and Chairman
National Association of Real Estate Professionals
www.narep.net
www.twitter.com/NAREPnet
www.facebook.com/NAREPnet

Oct 14, 2012 09:50 AM #56
Rainmaker
1,397,379
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate

I can not get to the FB page using link in the signature in #56.  I get an error message but found the page via FB  search.

 https://www.facebook.com/narep.net?fref=ts

Oct 14, 2012 12:25 PM #57
Rainer
2,443
Ben Caballero
National Association of Real Estate Professionals, Inc. - Dallas, TX

Maureen, thank you! I corrected the URL. (It was an indvertent space at the tail end of the URL that caused the error....) 

Oct 14, 2012 01:43 PM #58
Rainmaker
260,747
Bill Travis
Captain Bill Realty, LLC - Gilbert, AZ
Broker/Owner

Thanks for responding to my questions. I have one more.

In a listing presentation, how do I explain to my prospect that while 88% of buyers start their search on the internet, and Zillow, Trulia, and Realtor.com are the largest of all real estate search sites, that I will not be placing their home on ZTR or any other non-mls site.

I can explain that by not putting their listing there, that buyers won't be calling another agent who may not know anything about your home, or your community; But I don't think that would fly because they would probably be happy that buyers are seeing their listings, instead of keeping them away from those buyers.

 

Oct 17, 2012 07:10 AM #59
Rainmaker
1,397,379
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate

The Inman spin was interesting.  Or Rob Hahn's take on NAREP on Inman.  Rob always make me think.   I saw the Inman post  during the debate last night via Twitter, thanks to NAREP tweeting a response to the Inman post.

Oct 17, 2012 08:05 AM #60
Rainmaker
843,539
Lyn Sims
RE/MAX Suburban - Schaumburg IL Real Estate - Northwest Suburbs of Chicago - Schaumburg, IL
Schaumburg Homes

Maureen:  I'll go get the link when I get a chance. Should have included it, I wouldn't have minded.

Oct 17, 2012 08:15 AM #61
Rainmaker
1,397,379
Maureen McCabe
HER Realtors - Columbus, OH
Columbus Ohio Real Estate

Inman - Rob Hahn's   "Commentary: Brokers could address issues with listings data accuracy by cooperating with portals"  Agency is at the heart of syndication debate 

Does Inman still go behind a pay wall?

What Ben wrote in response starts:

Submitted by Ben Caballero on October 16, 2012 - 5:59pm.

"Rob, your commentary is entertaining, but your arguments miss the point."

It is commentary.

 

Oct 17, 2012 09:22 AM #62
Rainmaker
843,539
Lyn Sims
RE/MAX Suburban - Schaumburg IL Real Estate - Northwest Suburbs of Chicago - Schaumburg, IL
Schaumburg Homes

Maureen:  Who cares if it was a 'commentary'. Slight of hand wording with that vitriol. That gentlemen should be bombarded with opposing views.  Incorrect assessments from him regarding buyers brokerage as a failure in the industry?

My comment, eloquent as always, did not make it thru Inman's spam filter evidently so I don't know if my response will finally show up.  Just because I called him a 'pompous balloon of hot air?' Some people should not be given a filter as respected as Inman to spew nonsense. JMHO.

 

Oct 17, 2012 10:55 AM #63
Rainmaker
451,603
Laura Filip RE/MAX UTOPIA | Whitesboro Tx 76273 903-271-4978
RE/MAX UTOPIA Whitesboro Tx 76273, Serving all of Texoma - Whitesboro, TX
Your locally owned RE/MAX OFFICE WHITESBORO TX

Thank you for the interesting reading I will check into this more and see what I find. Note that the use of the term MLS is highly controversial in general and one must watch what ones states is a MLS site. There have been many changes in the past few years concerning syndication of listings, the use of the term MLS ect. Investigation is a good first step into the process you are talking about. Have a blessed day.

Oct 20, 2012 01:09 PM #64
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Lyn Sims

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