MLS to Redfin: Down Dog, and Kennel!

Rainer Maria Rilke once wrote that we have in love to learn only this: letting go. Everything else comes naturally. In starting Sweet Digs, a blog that provided independent, eyewitness reviews of houses for sale, we had forgotten this advice.

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(Bahn Lee, Sweet Digs mastermind)

After almost a year of negotiations came to a head with the Northwest Multiple Listing Service (NWMLS), Redfin announced yesterday morning that it would no longer publish in-person reviews on our blog. NWMLS rules forbid Redfin from advertising another broker’s listing, and the NWMLS deemed our reviews (particularly the harsh ones) as an advertisement. The NWMLS fined Redfin and has explained that our compliance with the rules is a prerequisite for continuing to access its database of listings. It is Redfin’s first major setback with an MLS, and everyone here is a little blue about it.

For all the well-reasoned jeremiads against this decision, few seem to have noticed just how good the reviews themselves were. Thanks are in order to our writers and editors: Amy Johnson, Anna Hibble, Anna McClain, Bahn Lee, Brenda Keener, Cynthia Pang, Jessi Princiotto, Kris Newby, Laura Reiter, Marie Hagman, Marilyn Krichko, Marina Andriola, Polly Meyer, Sue Herz, Susan Brady and Tracey Taylor. We chose you out of hundreds of applicants because you write so well, on a topic you care so much about.

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And you were often very funny, comparing houses to $1,200 jeans, wondering about satanic addresses, or surveying garages that changed the world. You could be brutally candid, but most of all you wrote with heart, for the abandoned houses you walked through and the quirky neighborhoods in which they were found. As the great William Shawn once said in a farewell to the magazine he ran for most of his life: “the operative word is, I think, love.” You gave Sweet Digs more love than we could have hoped or asked for — certainly more than we paid for — and it showed.

Lest you think we are too idealistic, we should also add that from a crass commercial perspective, you were wildly successful: you published a staggering 1,481 posts with 561 comments. Starting with a few hundred readers at the beginning of 2007, you roped in 3,959 e-mail subscribers and nearly the same number of RSS addicts; 42% indicated in a survey that Sweet Digs increased the likelihood they would buy a home from Redfin.We will try to cook up an alternative format, in which we sort through the detritus of past sales, but it won’t be the same as reviewing live listings on the open market.

The Seattle and Bay Area real estate markets have now lost a voice that on the whole was not only good for everyday people, but for the real estate industry itself. Consumers want candor about homes they can buy, and if as brokers we refuse to provide it, we will lose the authoritative, trusted position we’ve cherished for decades. As MLS rules force our sites to act as listing brochures, other websites will develop a monopoly on the truth, and we will pay those websites for traffic we should have had in the first place. We are not only giving away our brain and our heart, but our wallets too.

The MLSs don’t seem to realize that outdated rules against commingling MLS listings with data from other sources will preclude any brokerage site from accepting the basic premise of the Web 2.0 paradigm for building sites: mashing up data from many different sources to give consumers a comprehensive portrait of a market. These rules are dooming us to obsolescence. (By the same logic that ended Sweet Digs, we have been told we may have to stop publishing Zestimates alongside listings.)

It should thus come as no surprise that the commingling of listing data with other perspectives seems to be the next major front in the Department of Justice’s dispute with the National Association of Realtors. The question at the center of almost every skirmish in the modernization of real estate is who controls the information.

Who killed Sweet Digs? Everyone, including many of the brokers in Seattle, has pointed to the NWMLS, a mostly faceless, seemingly bureaucratic institution that struggled to respond to press inquiries about the decision. But the inconvenient truth is that the NWMLS is broker-owned, and that the people who run it are reasonable people who are simply trying to keep their owners happy. The big brokers in Seattle killed Sweet Digs. If you are working with one of these firms, be sure your broker hears what you think of the decision. And even if you’re not, you can sign our petition to the NAR, which demands free speech rights around listings.
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The whole situation of brokers blaming the MLS reminds us a little of Pablo Picasso’s response when Spanish soldiers saw his painting of the bombing of Guernica, and demanded to know: “Who did this?” Picasso immediately replied, “You did.”

Discussion

  • http://3OceansRealEstate.com Kevin Boer

    Here’s what I don’t get:

    I can “advertise” others’ listings at an open house by giving out lists of comps. I can “advertise” others’ listings by sending out postcards about recent sales. I can “advertise” others’ listings in a newsletter. But I can’t “advertise” others’ listings online?

  • http://www.edynblog.com Edyn Real Estate

    On looking at your Sweet Digs Blog the thing I see that my MLS would freak out about would be that you are not giving acknowledgement to the listing broker. On your normal listings page you give it. I guess IDX just allows you to provide what the listing broker wants you ro provide.

  • http://www.searchingseattleblog.com ARDELL

    Kevin,

    We obviously need to “advance the rules” to incorporate the Internet generally, and blogging specifically.

    Problem is you can’t get 12 broker’s into a room to discuss the issue with Open Minds and not merely to protect themselves.

    What amazes me is that an industry charged with being Fiduciary in thought “without regard to self-interest” can’t seem to act regarding the industry as a whole “without regard to self-interest”.

    We are allowed for sure to tell our clients all of the negatives about all homes. Over priced, LP siding issues, obsolete floor plan, needs a roof, bad foundation issues, etc. What we can’t do is post that to the public generally.

    What it might take is a password protected site, and only people who have signed Buyer Agency agreements would be able to enter the “full disclosure” site. But then you’d have to put your own listings in there saying “over-priced” too. Would your seller’s agree to that? Not likely.

  • http://www.ekday.com/blog/blog.html Shaun McLane

    In this day of “Mashups,” it bothers me to see this reaction. I always saw Sweet Digs as just another means of sharing take-it-or-leave-it information. Instead of focusing on these issues, the MLS (only speaking for my local MLS) should be taking the time to restructure their services and find better ways to compete in this changing web-universe.

  • Donald J. Moore

    I have a question… In my state, State rules require the licensee providing brokerage services to at a minimum: 1.) inspect the property and 2.) disclose material adverse facts prior to writing an offer. My understanding of your model is that your agents do not typically inspect the properties that they provide brokerage services, is that correct? The States of CA, WA, MA allow this? I know it wouldn’t fly here in my state. Unless your agents were also attorneys which exempts them from this requirement but then excludes them from obtaining an MLS-offered brokerage commission since they are not acting as a broker, but an attorney. Am I missing something here?

    Thanks

    Donald J. Moore

  • L.J.

    Donald,

    Redfin representatives are present at property inspections. As a Redfin client, each time I was interested in making an offer on a property and/or having a pre-inspection done, my husband and I would fill out the online offer wizard. Each time, no fail, we’d have a phone call within an hour from the Redfin agent assigned to our offer. They would act quickly to talk to the sellers agent, get the pre-inspection set up, and they always sent a field agent to supervise. Between the time we submitted the online offer wizard to the time just after the offer was submitted, our Redfin agent was in constant contact with us (twice we had agents who spent their scheduled day off negotiating for us).

    My husband I chose Redfin because we felt that we were capable of looking and assessing what houses were going to work for our budget and needs (with the help of the internet, it wasn’t hard to find viable houses). After fighting off the vulture buyers agents that were strategically staked out at open houses, I feel really good about our decision to use Redfin as our agent. Occassionally we had the “traditional” buyers agents try to talk us out of using a discount broker or try to sell us on why they were worth hiring (one guy even told us he got the MLS listings before anyone else did. Yeah right…)

    Our experience with Redfin exceeded our expectations, and on our 4th offer we got a house. Redfin was professional, friendly, thorough, and upfront with us. If I were starting over the homebuying process, I wouldn’t have done it any other way.

  • Donald Moore

    That’s all well and good but the law is the law. If State regulations require licensees to provide a minimum level of service related to inspection and disclosure, not providing these services allows an unfair competitive advantage over those who abide by State law. My question is does the individual agent writing offers and providing brokerages services inspect the property before they write the offer? The agent’s name has to be on the offer or there’s no procuring cause. Supervising field agents are not the same as a licensee providing a minimum level of State mandated services.

    Donald J. Moore

  • anna

    This just makes me sad. I will truly miss writing about condos priced as mansions that look like Best Western hotel rooms. I will also miss posting about places that are beautiful, homes I would love to live in myself: undiscovered gems that I imagine the lifetime SF-renter-who-wants-so-to-be-a-buyer (like me) would thrill to. I’ll miss too reading the other candid reviews. On nothing could a potential buyer rely more for an honest evaluation of a property- an honesty sorely missing from the real estate industry. Since we writers were always forbidden to review Redfin listings, there was never any threat of a conflict of interest (something no one could say with a straight face about MLS listings). I guess that’s what I’ll miss most of all: candor in the world of selling houses. As a first time buyer who actually got so third degree burned-out by realtor subterfuge that I actually gave up entirely for over a year, I’m still renting now because I could trust nothing about the market nor its representatives. Redfin to me was the muckraker of real estate. Without such honesty, the character of the entire industry suffers; and to quote Abraham Lincoln:

    “Character is like a tree and reputation like its shadow. The shadow is what we think of it; the tree is the real thing.”

    Without services like Redfin’s, the shadows not only obscure, but even replace that “real thing.”

  • Sue Herz

    How about ‘letting go’ of the idea that we have to inform buyers and sellers of what the real estate market has to offer them and instead educate the public on how to do the research themselves? Teach them how to ‘write their own blogs’ so to speak. I’ve written up a little instruction manual on how I evaluated houses when getting ready to write a blog about it on Redfin that I wouldn’t mind sharing if anyone wants to see it.

    Meanwhile Redfin can be working on reminding the real estate bureaucrats on what free speech is all about and that the general public is made up of intelligent and technically savvy people. The world is getting smaller even as you read my comment right now. Power really is about ‘letting go’. Let’s hand the power over to the consumers because they are the ones that are really in control. I feel that Redfin is standing on the cutting edge of a movement that will change the way the real estate market works in a positive way. I am totally jazzed about the thought of breaking up the ‘mafia’ mentality of the current real estate market. Let’s do it!!

  • Patrick

    “By the same logic that ended Sweet Digs, we have been told we may have to stop publishing Zestimates alongside listings.”

    I don’t know how the NWMLS rules are written, but as stated wouldn’t this also extend to county provided tax and sales records? Or year built, square footage, etc? That’s idiotic.

  • L.J.

    I think the MLS needs to spend less time picking on Redfin, and actually crack down on the shady things that so many other agents are doing, such as:

    1. Listing the square footage of the house while including the garage square footage in that number, the unfinished basement (even on houses where the basement is only accessable from outside, or the ceilings are far to low to even consider finishing)

    2. The business of re-listing a house under a new MLS number without the regulation number of months off market prior to re-listing. Often they’ll have a different price or with different photos (the only people who would be fooled by this are customers new to the market; any agent or seasoned consumer will notice this)

  • http://www.CashbackRealty.com David Gorman

    The real estate lobbyists have been successful in getting the TN legislature to enact a rebate ban which would make it illegal to give buyer broker rebates; thus creating a legal cartel. The legislature sided with the real estate agents and ignored the petitions from the DOJ. This is very troubling for free market competition and will harm the consumer. Please contact the Governor Bredesen and ask him to VETO House Bill 2095. He has until 5/30 to sign.
    See http://www.tennessean.com/apps/pbcs.dll/article?AID=/20070518/BUSINESS01/705180389

    David Gorman
    Real Estate Broker
    Cashback Realty.com
    http://www.CashbackRealty.com

    Governor’s Office
    Tennessee State Capitol
    Nashville, TN 37243-0001

    Phone: 615.741.2001
    Fax: 615.532.9711
    Email: phil.bredesen@state.tn.us

  • http://louisvillehomes4sale.com Louisville Realtor

    what a shame that there won’t be any more reviews. I quite enjoyed them. :(

  • http://www.redfin.com/buy Rob McGarty

    Donald,

    Redfin is in compliance with all laws and regulations.

    A licensed Redfin agent accompanies our clients on home tours, structural inspection, appraisal and the final walk through. In states like California where a Transfer Disclosure Statement (TDS) is required the licensed Redfin agent performs a visual inspection and completes the TDS paperwork.

    We only operate where we can be in compliance with all the local laws. As David points out, we can’t enter Tennessee until the laws change.

    Please let me know if you have any further questions.

    Rob McGarty
    Redfin
    Director, Real Estate Operations
    206-859-2844

  • NJ Realtor

    Kudo’s for the try and innovation of taking real estate to the next level. Maybe when others decide to catch up , you can try again.

  • http://careandcare.cn Best homes for you

    A bit out of subject question… about 1st picture…
    Does the guy work with 2 monitors simultaneously?

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  • http://www.orlando-real-estate.biz/Search_MLS_Listings/page_1956435.html Orlando MLS

    I’m an agent in Orlando and I for one am a big fan of what your company is trying to achieve. Innovative ideas only create competitiion and competition only benefits the consumer. Many people in the real estate world are so commission focussed that they forget entirely about the client. Job well done guys! I’m batting for you and would love to see you thrive in this new real estate environment.

  • Webby

    I work for a web-based company and we all have at least 2 monitors. I code in one and preview my work in a browser on the other.

    Just to bring this back on subject, I’m also very disappointed that Sweet Digs will no longer be able to write about individual houses on the market. I hope in the future something can be done to change this.

  • affectedbuyer

    Hint to a buyer,

    I really don’t think the redfin truly a buyer agent, they act like buyer agent until your offer is been accepted by the seller, once it’s done the red fin agent will act like seller agent, and they make you accept everything the seller says. Not even little bit consideration about the buyer.
    surely I won’t recoment my true friends.