The nation’s largest MLS is giving the funds it receives from listing syndication to the brokers that provided the listings — and encouraging other MLSs to follow its lead.
California Regional Multiple Listing Service (CRMLS), which has more than 80,000 agent and broker members, has cut checks totaling about $160,000 to about 1,300 of its member brokerages.
CRMLS is handing over all of the money it obtains from syndication back to brokers, minus the costs of printing and distributing the checks, the MLS said in a press release.
These are brokerages that contributed 10 or more listings to the CRMLS database between April 1, 2015, and March 31, 2016, and chose to allow CRMLS to distribute those listings to third-party websites for them.
The payouts aren’t huge for most brokerages, but the move may start a trend. If nothing else, it is a symbolic gesture that addresses the lost economic opportunity some brokers fuss about when discussing control of listing data.
“Our hope is that this new income stream, a direct result of the labor of CRMLS’s member brokers and agents, will assist participating brokerages in offsetting operational costs of obtaining listings,” CRMLS said in a blog post.
How much?
The MLS is paying out $1.36 per listing, so the smallest check amount a broker will receive is $13.60. The biggest check amounted to more than $10,000, according to CRMLS CEO Art Carter.
The median check amount is $39.51, which is equivalent to about 29 listings, he told Inman.
Art Carter
CRMLS syndicates listings to more than 80 third-party websites, mostly through third-party listing syndicator ListHub. But the MLS only earns licensing fees from websites that it has direct-feed agreements with.
CRMLS is persuading those 10 or so websites to pay licensing fees “when we can,” Carter said.
When asked whether Zillow, Trulia, realtor.com or homes.com were among the payees, he declined to say, citing contract obligations.
The MLS will send out syndication checks annually, Carter said.
Why not everyone is getting a check
In order to participate in syndication, CRMLS brokers must opt-in — their listings are not automatically distributed to third-party portals. About 60 percent of the brokerages with listings have opted-in to syndicate, according to Carter.
A lot of the other brokerages belong to franchise systems and have their franchisors syndicate for them, he said.
But many of the MLS’s 14,000 or so member firms have no listings, he added. The vast majority of the firms are one-man offices.
“Typically, only about 48 percent of our members in any four quarters participate on one side of a deal,” Carter said.
“Historically since I’ve been here at CRMLS, that has been about the average.”
Listings with confirmed rules violations and fines are deducted from any check amount — which could have the added benefit of incentivizing the submission of clean data to the MLS.
Of note: If CRMLS brokers choose to syndicate their listings through data management platform Upstream when it launches, they won’t receive any further syndication checks from CRMLS, according to Carter.
When asked whether this was intentional, Carter said, “This is something that has been in the works for nine months. Upstream wasn’t anywhere in the thought process.”
The bigger picture
CRMLS is best known for its efforts to create a statewide MLS in California. Does the MLS think this move will encourage brokers to push their associations or MLSs to join CRMLS?
“The intent really isn’t to set CRMLS apart,” Carter said.
“I think more MLSs up and down the state should follow our lead in doing this.
“There’s a lot of angst out there about the monetization for the MLS data, and we’re firm believers that any money that comes in for the data should be distributed back out to the brokerages.”
Money and control
The MLS’s efforts to consolidate are not without controversy.
Last month, two of the three associations that own San Diego-based Sandicor Inc. filed a lawsuit asking a state court to order the dissolution of the regional MLS, in part to free the associations to join CRMLS.
The third association opposed a merger with CRMLS, which it claimed would “destroy and devalue” the Sandicor database.
CRMLS seemed to refer to these concerns in its blog post announcing the syndication checks to brokers.
“Recently, there has been a lot of information floating around about the value of MLS data,” the post said.
“Some voices in the industry have made the argument that there is great value in MLS data, but that that value is yet unknown.
“Therefore, they contend, brokers should be wary of MLS consolidation because it could mean them losing control of their listing data and not reaping the benefits of its ‘hidden’ value.”
By putting a dollar amount to the listings, CRMLS appears to be laying bare some of that hidden value.
The MLS is also taking the opportunity to point out that the value of an MLS database increases with its size. About 130,000 listings are entered into CRMLS’s database on a yearly basis, according to Carter.
“As the nation’s largest MLS, aggregated data from our brokerages is naturally of far more value to syndication partners than any smaller area’s data could hope to be,” the blog post said.
“It covers a broad area and demographic range, and therefore offers a comprehensive look at many aspects of the California housing market.”
The MLS also reassured brokers that they would maintain control over their listings.
“We know that getting listings is hard work, and that’s why CRMLS recognizes that our brokers deserve full authority over whether they participate in syndication,” the post said.
“CRMLS is committed to maintaining brokers’ control over the listing data. No amount of data sharing or MLS consolidation is ever going to change that.”
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