Data licensing remains a controversial issue within the real estate industry, and multiple listing service organizations have been scared off from innovating on that front, according to an MLS Technology Survey conducted by WAV Group.
WAV Group, a business and technology consultant, surveyed 208 MLS representatives from 164 MLSs nationwide to gauge technology sentiment at the organizations. Only 15 respondents said they plan to license MLS data for non-traditional products in the near future, while 85 said no and 87 said they were undecided. The remaining 21 survey participants didn’t answer.
Data licensing is “still in a wait-and-see mode,” said Mike Audet, partner with the WAV Group. Concerns about data licensing include whether it’s appropriate to license data beyond its original uses, questions over who owns the data and whether it is proprietary information as well as worries over privacy and confidentiality of the data if it were licensed.
Survey responses varied on the question of what big changes MLS organizations foresee in the industry, but included some recurring themes. Some of the more notable answers included:
- More consumer-focused systems, such as Web sites/more public inclusiveness;
- Transaction management;
- Large broker impact on MLSs;
- Increased focus on data security and data monitoring;
- Continued growth of for-sale-by-owner and discount MLS sites;
- Mega stores like Wal-Mart entering the MLS world;
- Wireless goes mainstream like the fax machine;
- Expanded integration with GIS capabilities in all products and devices;
- More in-house development at database level with integration to multiple products, and
- Expansion of regional MLSs to super-regional MLSs.
In the vendor ratings, boutique vendors Realgo and Stratus received the highest rankings from their customers. However, both have small client bases and in many ways can provide the type of service and systems typically equated to in-house systems. Realgo currently has one customer, IRES, a Colorado regional system with about 5,000 users, and Stratus has two customers, Toronto and Long Island, N.Y., with 22,000 and 19,000 users respectively.
Not counting Realgo and Stratus, Rapattoni topped the field for overall vendor rating. Simi Valley, Calif.-based Rapattoni has been serving real estate associations since it was founded in 1970. More than 200 real estate associations, including 26 state associations, use Rapattoni software.
Following Rapattoni was Solid Earth, a Huntsville, Ala.-based company that launched in 1998. It was founded to create competition for a custom MLS system in Huntsville, Ala. The founders are experienced in custom software implementation, project management, commercial real estate appraisal, appraisal software development and computer programming.
The rankings after Solid Earth were: FBS, Interealty, Offutt, in-house systems, other systems, ARIS, Marketlinx, FNIS, SEI, Quest and AMS.
The overall rankings were devised by combining responses to questions on vendor and system satisfaction with questions on specific features and service. Overall, most respondents appeared reasonably happy with their vendors, with about 60 percent indicating they’d likely renew relationships with their current vendors.
Some MLS features were rated poorly across all MLS systems. They were comparative market analysis, statistical reporting, contact management, tax functions and report writers.
Users of in-house systems did not rank them as highly as users of some off-the-shelf systems ranked those systems. That could be attributed to users of in-house systems being willing to forego some of the bells and whistles on ready-made systems for other benefits they realize by doing things in-house.
“It isn’t cost and it isn’t functionality, in our opinion,” the authors wrote. “It appears to be primarily an issue of control. In the survey, 10 MLSs that currently use ‘off the shelf’ systems indicated they are considering building their own MLS system next time around. This doesn’t bode well for our MLS vendors who have been facing a shrinking technology market for a number of years.”
Of the respondents, 12 MLSs indicated they plan to implement a transaction management system within the next 24 months, and 19 said they plan to implement a system in the next 12 months. Another 34 MLSs said they wouldn’t implement transaction management, and 132 respondents said they were undecided. Transaction management systems manage every piece of a real estate transaction from listing to closing, enabling all parties to the transaction to communicate 24/7, often on the Web.
“I think right now people don’t recognize the immediate value and the pain it’s going to cure, so it just hasn’t happened yet,” Audet said of the low number of MLSs planning to install transaction management systems.
WAV Group provides business advisory and technology consulting services to the real estate industry. The company has offices in Snyder, N.Y., and San Luis Obispo, Calif.
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