The International MLS Forum was selected as WAV Group’s international conference this year. We sponsored the event through RE Technology, our tech publishing business. If you have not been to an international conference, you are missing a key perspective. I know that many are critical of the investment in time and treasury that some U.S. MLSs are making on International, but I will tell you that it is unwarranted.
If you want to get a clue about the value of the MLS, then go abroad.
One sentiment is abundantly clear: if you operate in a real estate country without an MLS, then you join an MLS in America — and you are amazed. Similarly, if you go from the United States to Europe (as many brokerages have done) you pine for MLS everywhere.
Real Estate for consumers and professionals without an MLS can only be described as crude, and full of fraud. Imagine if Craigslist, or the newspaper, was the only source of property information. In most countries, the only access to inventory for sale is through advertising portals. They have enormous market power, and a huge percentage of the advertising is false advertising. Bogus properties are advertised for lead generation for fraud.
Where to start
Over the past decade of attending the R.E.N.T. Conference in Paris, I have learned that the genesis of an MLS system is not in new listings. For most markets outside of America, brokers have no interest in sharing their properties for sale through an MLS. But when you change the conversation to sharing sold records, the interest rises. They do not put much value on sold records, but see no threat to the construction of a robust database that all brokers contribute records to build. Brokers see the long term value of sold records when combined with the sold records of other firms. We believe that this is the place to start.
Who Holds the Opportunity
There are a handful of major global businesses in the United States and Canada who already cooperate with each other in America. My short list would include LeadingRE, Anywhere, Keller Williams, Christies, eXp, RE/MAX, Engel and Völkers, to start. Combined, they represent significant market share in places like Europe and South America.
Cooperation with U.S. based MLSs is also broad among this group. The value of the historical records is well understood, and easy to embrace as a strategy.
How to cooperate
WAV Group has had the great fortune of pulling together interested collaborators in many successful ventures between brokerages and MLSs. A keynote of each successful venture has been identifying the mutual benefit, and staying focused on that benefit. The overarching benefit to expanding MLS to more markets across the globe is providing a pathway to accurate property information that satisfies the consumer and the real estate professional.
Accurate property sales information is a keynote benefit to consumers and professionals.
For a variety of reasons, the sharing of active listing information is a bridge-too-far in the development of an MLS as a startup. For too many years, the America MLS was understood around the offer of compensation—a theme that does not exist across the world. The offer of compensation is now deceased as a covenant of the MLS in America, and was just recently put at risk by the Competition bureau in Canada.
Today, brokerage in America has become more similar to how properties are sold around the world. Consumers can put their home on the market themselves, or use a sales agent. Buyers can search and identify for-sale properties themselves, or use an agent. The role of the MLS is not about commission sharing, or advertising homes for sale; It’s for historical record keeping and research.
The MLS as a marketing site for listings can come later
Eventually, when competitors recognize that they would rather cooperate with each other (rather than third party advertising companies to market listings), then the MLS can start that service. For now, new MLSs should leave that strategy behind.
Data as an Asset
When brokers cooperate with each other to build a solid database of sold properties, they begin the process of developing a data asset. Today’s disparate data held by individual firms is nearly worthless. Data value is only achieved when it is comprehensive: all sold (or most) records; accurate – clean data; timely – as current as possible; standardized – and organized in a data format like RESO that allows systems to easily query the data.
What’s Next?
If you are a brokerage that is interested in working with other brokerages to cooperate on developing a company to consolidate sold records for mutual benefits, please reach out to Victor Lund or Marilyn Wilson. We are eager to move these initiatives forward.
If you are an MLS who did not attend the International MLS forum in Milan, Italy, you should put it on next year’s travel schedule. It’s a great conference to get a real perspective on the value of the MLS that you have. Moreover, there is an enormous opportunity for cooperation with international firms to build international opportunities. MIAMI MLS has long been the international MLS leader. Others are waking up to this opportunity in impressive ways. Stellar MLS has developed an International Consulting Group to help companies collaborate on projects with US MLSs.
At some level, if your MLS area represents a city with a lot of International business, you need to develop an international strategy. The volume of international buyers in America is significant and growing. It is normally $100 Billion in transaction revenue. International buyers have been purchasing fewer properties in the U.S. recently. Canada, China, and Mexico were the top countries with foreign buyers, with Chinese investors spending the most, particularly in California. Florida remains the top destination for international buyers, followed by Texas and California.
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