Friday, July 9, 2010

Principle 4

You know the program--my comments in alternate type below. This one took awhile. It's simple, but delicate because it takes some not very subtle jabs at existing MLSs and AORs, in order to rationalize change. 
4. MLS entities should exist for the benefit of the participants and subscribers.
We believe that MLS fees should be set at a rate that gives the MLS and/or the Local Association a fair return for delivery of MLS services. We believe that local Associations of REALTORS� provide valuable services to their members. These include services and activities that advocate for homeownership, ethics and professionalism in the industry. We believe that local AOR’s should be adequately and fairly compensated for these services, including those that may be directly associated with an MLS. 
It's really important to remember this was written in 2005. The ecology of MLS services on the left coast is different now that the state association IS an MLS vendor itself (albeit half a step and future merger removed). Before "broker load" and online applications were widely adopted, running an MLS was a labor intensive job for local AORs. Association offices had hardware and back-up systems, routers, etc. and the AOR/MLS staff performed diverse technical operations. True, by 2005 most MLS systems were web based, but this Principle points to an earlier time as it questions motives for  MLS fee structure. We won't belabor the financial failure of the state association's efforts to become a statewide MLS--sure is handy to have a seemingly endless line of credit available.  


First sentence implies that MLS may NOT be primarily operated for the benefit of the members. Second sentence suggests MLS service fees see use in supplementing association profitability. Whether that's any business of the state association, is a moot point, particularly in view of their attempts to get in the MLS business throughout the state. Nevertheless, the state association knew about, but did little to address these alleged concerns for decades. As its attention focused on expanding state association services, products and control through direct marketing to members, a striking shift in attitude evolved. Principle 4 brought that new found concern for MLS members out in the open. Random circumstance? Regardless, relations between the state association and local AORs have been on a downward path ever since the Principles were released.
Moving on, Principle #4 concedes local AOR have functions, it just doesn't seem exactly sure what they are, because the items listed are covered by the state and national associations. No mention of the local interactions with community and agents that are only possible with the sustained presence of a local association communicating a consistent message and responding to local member and community needs. 


The final sentence indicates the local AORs and MLSs should be adequately compensated for performing tasks also performed by the state association. Strange twist, poor writing, a portent of things to come, or all of the above? 


The tension between the state association and local AORs has increased significantly over the past 10 years. Power is shifting in the all too familiar "one size fits all" direction with the state association standardizing educational offerings, forms, technology and perhaps, MLS services across the state. With few alternative products and services to compare, most members are pleased with the apparent simplicity of this brave new corn field of homogeneity. Whatever members want, the state association has a product or service for purchase. Is it the best one possible? Who cares because it's important that members support THEIR associations (state and local). Besides, easy one stop shopping saves time. 


How will this standardization trend play out in the future? The role of the local AORs in promoting and assisting the state association in selling it's wares will expand with locally oriented AOR programs likely to further decline in frequency and quality. What's the future of locally owned and operated AORs? Good question! A better question is what does that answer have to do with statewide MLS endeavors?


Returning to the "sponsors", are there benefits to the public in consolidation plans for AORs and MLSs? It is still hard to see any significant benefit in terms of finding the RIGHT HOUSE or the RIGHT BUYER. Buyers, Sellers and houses are physically localized. Wise choices must be based on very specific distinctions. Sweeping commonalities or efficiencies of scale (the public is not likely to see any financial benefit there) are not going to matter in the housing decision, regardless of promotion or politics.


As is the case with the other principles, benefits from #4 flow in a surging torrent toward the prevailing statewide MLS vendor. A trickle of financial relief could dribble to users via slight reduction in MLS fees. The public will encounter a lower average quality of service due to agents ranging far and wide, beyond their radius of effective knowledge.  


  

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