size of what?

Quick follow-up in the SIZE genre. Among the many emails I get daily regarding products and services for agents, brokers and firms are very few directly addressing the quality of service offered to the public or seeking to enhance the experience the public has during the process of selling or buying real estate.

The industry is self absorbed in the pursuit of increasing sales and commission metrics. There are seminars on risk management, recruiting top agents, using social media to get more buiness, the latest and greatest upgrade to third party data providers---to get more business etc, etc. Then there is the MLS theater--statewides, mega regionals, national resources and new applications all play out on the stage of politics, power, control and greed. Funny thing---no one discusses how any of the secret negotiations or mergers will actually assist Buyers to find the RIGHT house and purchase it at a fair price with a minumum of complication and liability.

Quite the contrary, the wider and wider coverage by mega regional MLS data (or the national trade organization super data resource) will, ON AVERAGE, result in a greater number of agents working outside their geographic area of expertise, thereby diminishing their ability to deliver the subtle nuances of local lore, micro climate, ambiance, etc. that should play into the consumer's final decision to purchase and contribute to their subsequent enjoyment of positive experiences. The net result could be a decrease in AVERAGE level of servuce to the consumer. Can anyone identify a compensating benefit that ultra wide data coverage produces? The only one I can come up with is the opportunity to use an MLS vendor who would not serve a smaller MLS. Is that benefit worth the potential cost to the consumer? Considering that most users only scratch the surface of MLS application capabiliities, probably not.

If a buyer is interested in a house in San Luis Obispo, for example, how does he or she benefit if the MLS includes data for, say Glendale (BTW it doesn't--yet)? I've asked that question and no one has a plausible answer. It may be good for brokers who have lots of agents operating on straight commission. Every so often one might fall into a deal in some far off area yielding a tidy split. So we have a major MLS data initiative with huge investment of time, money and politics by mega brokers, regional MLSs, trade organizations and vendors (those last two can be the same thing these days) all pointing at a change that will probably diminish the average quality of service the consumer receives. More importantly, ON AVERAGE, it will increase broker profitability and offer ample opportunities for some power and control reallocation--mother's milk for organizational politicians.

Is this a good trade off? Did anyone think to ask the consumers if they would like a decrease in service so broker profitability could increase and a few leadership types could gain political cachet? After all, consumers pay $50 BILLION dollars a year in commissions--what do they expect for $50B??? I think the industry leaders believe that consumers won't notice. Even if they do, the brokers are in a cool position, because the full impact will hit, not them, but some of their agents--and the brokers have so little invested in their agents, it won't make a ripple. They'll go hire more agents.

Informed Buyers might be expected to want the most knowledgeable agent they can get--one who knows the neighborhoods of key interest house by house from experiences gathered over many years. In recent times the industry headed off in another direction propelled by an expansive virtual world populated with increasingly sophisticated computer applications that still provide no more than a dim representation of the experiences associated with living in a particular town, neighborhood, block, street and house.

You see, it's easy to control data--it's consistent, doesn't change and it doesn't think or have dissenting ideas. Power organizations like data, it simplifies their world--in fact if they play the game just right the data becomes their world. Then they really are at the center of EVERY transaction.

Consumers don't occupy a virtual world, but agents do, at least to a greater degree than in past decades. Consider this, how wide an area can an agent effectively work--how many houses (plus streets, neighborhoods and towns) can an agent become familiar with on an detailed basis, at least to an extent that will fully serve consumer needs? You could argue that kind of familiarity isn't necessary to provide quality service, but what if another agent did have that kind of familiarity? Could that be an advantage to the consumer? Of course it could, but the industry is discounting that possibility without asking the question. At best, the industry and trade organizations remain neutral, while enthusiastically charging after the benefits of consolidation and disintermediation, largely through meetings not open to consumers or the rank and file practitioners.

In a profitability sense this trend toward ever expanding MLS data coverage is good business--fewer Broker fees and dues for multiple MLS memberships (this was the number one reason for the 6 principles that kicked all this off 6 years ago), more leads for agents, more opportunities for commissions and more splits for the brokers. Most agents spend less and less time in the office because it's a virtual world out there! Anything that's important about houses can be found in the computer using those big databases. Why spend time actually researching houses, streets, neighborhods and towns in person? That's all been done--hasn't it? It's easy, sort out a showing list from the computer and go close 'em on their favorite house! It may not be the RIGHT house, but it's a good one--the computer said it matched their criteria!

Are the consumers concerned about this trend? Well, houses are still selling and commissions are still flowing --- so all must be fine with consumers. Why wouldn't it be? Just like the agents, they're getting more and more data from wider and wider areas all the time---what's not to like?