Where Real Estate Gets Its Dirt

Industry Relations: Rob & Greg’s 2018 Real Estate Industry Forecast

What’s in store for the real estate industry moving forward into 2018?

Some might consider this a supplement to Rob’s article on Inman News, 7 predictions 2018: Disco Fever.  But it was recorded before the article was published.  In this episode Rob and Greg try their hand at anticipating what’s ahead, offering predictions around the outlook for the MLS, Bob Goldberg and the NAR, the housing market, brokerages, technology and the culture of the industry. They begin with the ‘Blame the MLS’ debate caused by Bob’s response to the Inman Upstream article and Greg’s subsequent South Park blog post. Next, they offer an overview of leadership changes among major industry players and work through the big mystery surrounding RE/MAX’s failure to report Q3 earnings.

Rob and Greg speak to Facebook’s entry into real estate, discussing the differences between the social media powerhouse and Zillow as well as the potential for a syndication deal with Facebook in the coming year. They cover how MLS of Choice is likely to affect the industry, the continuing trend toward the tech-enabled brokerage model, and how NAR’s success in making changes to the tax plan might play out in the 2018 campaign season. Listen in for Rob and Greg’s insight on how the cultural phenomenon that is #MeToo might rock real estate and who will make the biggest splash in the technology space this year.


What’s Discussed:

The tendency among industry players to ‘blame the MLS’

The mystery around RE/MAX’s failure to report Q3 earnings

Facebook’s entry into real estate

– Match vs. search

The potential for a direct syndication deal with Facebook in 2018

Real estate as the ‘last frontier of disruption’

Greg’s insight around the rise of virtual MLSs

How MLS of Choice could trigger the first ‘hostile takeover’

The likelihood of non-contiguous consolidation activity among MLSs

Rob’s take on how HAR could leverage MLS of Choice

NAR’s big win on Capitol Hill regarding the tax plan

NAR’s increase in political spending in 2018

The trend of brokerages to adopt a tech-enabled model

–  Keller Williams culture of freedom
–  Agent adoption not a given

Mergers and acquisitions in the vendor space

The probability that #MeToo will rock real estate in 2018

Who is apt to make the biggest splash in real estate tech this year


Resources:

Andrea’s Upstream Article in Inman

Bob’s Email Response

‘Blame the MLS’ on Vendor Alley

Rob’s 7 Predictions for 2018

Everybody Wins: The Story and Lessons Behind RE/MAX by Phil Harkins and Keith Hollihan

Mike’s Breakdown of Facebook vs. Zillow

Inman Article on Using Facebook for Lead Gen

Brad’s NAR Article in Inman


Connect with Rob and Greg:

Rob’s Website

Greg’s Website

Merry Christmas everyone!

Hope you and yours have a great day.

Vendor Alley 2017 Gift Guide

Here’s a list of items any Vendor would love.

1. Apple MFi Certified USB to Micro USB + USB Type-C + Lightning Charge & Sync Cable, 3ft Black. Currently out of stock but you must have this cable in your bag.

2. Juiced Systems BizHUB USB-C Multiport Gigabit HDMI Hub, 3x USB 3.0 Ports, Gigabit Ethernet, HDMI 4K, SD/Micro SD, USB-C Power Delivery
For those having gone to the pain of upgrade to a new MacBook Pro and the nightmare of USB-C, this thing is a life saver, better than Apple’s in my opinion.

3. Apple iPad Pro
Speaking of Apple, I just love this thing. I prefer the 10.5″ version. And spend the extra money and get WIFI + Celluar. As shitty as airport and hotel’s WIFI is its always cool to have another option. Think of it as you own personal WIFI spot with a huge battery. PRO TIP: If you are on AT&T with your phone get on another network with your iPad. That way if one network is down or not accessible you have a backup.

4. Eyekepper 5-pack Spring Hinges 80’s Reading Glasses +1.25
These are cheap ray ban knock off reading glasses. They come in a 5 pack so I can just keep a pair upstairs, downstairs, in the garage, wherever.

5. AirPods
One of the those products that you wonder how you did without them.

Happy Holidays everyone!

Redfin smacks down MLS hit piece

Well it looks like at least Redfin isn’t blaming the MLS.

Glenn Kelman and Chelsea Goyer of Redfin published a blog post, titled, A Tragedy of the Commons, which rebukes a paper published from the Center for Data Innovation. Everyone should read the whole post. Here’s a few highlights.

Redfin Has Not Been Hindered by the MLS

The study’s claim that it is unnecessarily cumbersome for “Redfin to be licensed brokers” in every state or to “apply for and maintain membership in every single MLS within these states” is wrong. Redfin’s expansion efforts haven’t been hindered in the slightest by MLS licensing requirements because we already require a brokerage license to employ agents and serve customers. We join the local Multiple Listing Service not only to access other agents’ listings, but to distribute our own agents’ listings to others.”

Okay.

Local Differences Between MLSs are Not Nefarious

To be sure, the study is right that Redfin incurs costs accommodating differences in MLS data about waterfront properties in Seattle, gated communities in Phoenix, or historical registries in Richmond. These differences are cumbersome for brokerages as well as third-party portals, and, as a strong supporter of the Real Estate Standards Organization, Redfin has advocated for standardization where possible. But the local differences that exist today aren’t nefarious or anti-competitive.”

Much different tone than these guys, what could possibly be the reason??

The MLSs Are Not Discriminating Against Low-Fee Brokers

We thus find each of the study’s claims about Redfin to be wrong. The authors of this study could have avoided making claims about Redfin that Redfin itself would dispute, just by contacting us beforehand. Our position on the MLS and data syndication is well known: we’ve stated publicly many times that we’re a strong supporter of the Multiple Listing Services’ efforts to share listing data among all brokers, especially small brokers who compete aggressively on price.”

One could argue initiatives like Upstream are more about helping larger brokers, and stifling smaller brokers or brokerages with alternative business models like Redfin.

Maybe the real reason that brokers belonging to groups like The Realty Alliance want to circumvent MLS Providers is that MLS Executives are doing their job, maintaining a fair marketplace, and doing it well.

Sit here, look at the camera, and read this.

If you look closely you can see Alex blinking “Get me out of here” in morse code.

Jason Sanchez promoted to CEO of Greater El Paso Association of REALTORS

Jason Sanchez promoted to CEO of GEPAR

“Coming in as the new CEO will be industry veteran Jason Sanchez. Renowned nationwide for his work within the MLS Industry. Jason brings with him over sixteen years of experience within the association. He currently sits on multiple boards and councils. Which include Corelogic, Zillow, CMLS & Project Upstream. Jason hopes to continue his work into making the local association among the most progressive in the nation.”

I can’t believe I missed this news! Congrats Jason!

Blame The MLS!

More Upstream drama

Andrea Brambila at Inman News wrote a story about how a few NAR Directors were under the impression that Upstream would be REALTOR Only. Not the case says NAR…

“Yet just recently over the last few weeks, three NAR directors told Inman they voted to fund Upstream under the presumption it would be available exclusively to Realtors — that is, certified, dues-paying NAR members. NAR and Upstream’s leadership, however, disagree, saying they have always maintained Upstream would be available to all brokers, not just Realtors.”

Someone has some explaining to do…

“Diana Bull, a Santa Barbara, California broker who says she’s been an NAR director for the last 31 years and a member of RPR’s advisory board since 2009, also seemed astonished to find out that Upstream would not just be for Realtors.

“This is really an anomaly,” Bull told Inman. “For NAR to fund millions of dollars for Upstream … for brokers who are not Realtors … it’s something that I really have to look into and it’s something that I should know about being on the RPR advisory board and being in the positions I hold.”

She, like Frank and Stroman, believes other NAR directors also voted in favor of Upstream funding thinking it was going to be a tool only for Realtors. “It was never discussed that non-Realtors would have this benefit after we have funded millions of dollars for Upstream, now twice,” she said.”

Well, this whole drama got NAR leadership involved. Newly appointed NAR CEO Bob Goldberg penned a letter to the membership. Which is pretty unusual.

“Some of you have read Inman’s latest article, which questions whether Upstream should be available to brokers who are not REALTORS®, as well as our NAR membership.

Since the very beginning, the Upstream contract outlined both a member and non-member pricing approach. That has never changed, and many products and services in this industry follow the same model.

NAR offers products to both REALTORS® and non-members and gives NAR members preferred pricing. Multiple listing services are also an example of a service that is available to both REALTORS® and non-members.

This approach can incentivize non-members to join the association to get more attractive pricing.

I think it would also be useful to clarify here that RPR is a vendor for Upstream RE, LLC; Upstream is independent from NAR. Upstream’s approach is driven by the large brokers on Upstream’s Board.

Effective January 1, 2019, Upstream RE, LLC will be responsible for 100% of all operation costs, with some dollars coming back to NAR.

I would caution everyone here to consider the context behind and genesis of stories like these. This particular article is clearly written toward a specific point of view and positioned to benefit the interests of some of the MLSs versus those of our members, who ultimately own this listing and intellectual property data.

Bob”

Emphasis mine.

Seems like Bob might be reading former NAR CEO Dale Stinton’s playbook…

RULE #1: Blame the MLS.

Industry Relations: Rob and Greg’s 2017 Year In Review

Take a moment to reflect on the past year in real estate… What were the hot topics of 2017? The appointment of a new NAR CEO is probably on your list, along with Zillow jumping into the iBuyer game and Redfin going public. Maybe the Upstream pivot came to mind, or one of the many stories around venture capital and private equity investing in tech-enabled brokerages.

Rob and Greg are taking the time to look back at 2017 and discuss the top five issues that rocked residential real estate this year. They start with the appointment of Bob Goldberg as the new leader of NAR, evaluating his performance so far and how the proposed tax bill will test him in this role. Rob and Greg go on to cover 2017 as the year of the iBuyer, explaining how the model is yet to be profitable and the circumstances under which platforms like Opendoor and OfferPad might become more mainstream.

Rob offers his take on the dynamics between Redfin and Zillow, discussing why he considers the Redfin IPO to be the biggest thing in real estate this year. Greg raises the issue of SoftBank’s investment in Compass, speaking to the influx of capital pouring into the space and the many examples of consolidation in the industry. They walk through the impact of MLS of Choice and what might change as a result of the new policy as well as the question of what success looks like for RPR as Upstream appears to lose relevance. Listen in for Rob and Greg’s overview of the hottest stories in real estate this past year and their insight on what’s to come in 2018.

What’s Discussed:

The appointment of Bob Goldberg as NAR CEO
How the tax reform bill will serve as a test for Bob
What made 2017 the year of the iBuyer
How market conditions and margins impact the popularity of iBuyers
Why Rob considers Redfin going public the biggest event of 2017
Redfin’s employee-agent model and culture of consumer focus
The influx of capital pouring into residential real estate
– SoftBank’s $450M investment in Compass
– Consolidation and tech-enabled brokerages
The significance of ‘MLS of Choice’
The proposal to shut down RPR
Upstream’s apparent loss of relevance

Resources:

Brian Boero on 1000watt
“Why Does Compass Keep Winning?” in Inman

Connect with Rob and Greg:

Rob’s Website
Greg’s Website

Alex Lange is committed to Upstream

Upstream CEO Alex Lange is freezing himself to be prepared until Upstream launch, slated for 2099. ????

* Sorry Alex, I saw this on Facebook and couldn’t wait till April 1st or CMLS Weekend Update for this one. ????????????????????

#FridayFun

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