Industry Collaboration Facilitates Homeownership

Over the past few years, the real estate market in Colorado has evolved, growing less affordable for many of the state's residents. A sudden influx of 570,000 new people between 2009 and 2016 put the Centennial State at a disadvantage when it came to meeting necessary housing demand.

As the Colorado real estate market changes with rising interest rates and escalating cost of living, the tools that benefit brokers, homebuyers and sellers need to transform as well. This explains recent discussions to ensure multiple listing services (MLSs) – organizations that maintain databases to provide accurate and structured data about properties for sale – remain vital tools that benefit brokers, homebuyers and home sellers across the state. By working together, listening to brokers and responding to new trends, the MLS industry can make the home-buying and selling process better for everyone involved.

TRENDS

CYBERSECURITY + WIRE FRAUD

Over the past few years, cybersecurity has become top of mind for businesses. With so much sensitive consumer and prospect information stored in MLS databases, it's vital that personal information remains secure. Are there simple steps that can be taken to reduce the potential for cyber crime? 

At the very least, organizations should be prepared to take advantage of multi-factor authentication (MFA) whenever it's offered. MFA confirms a user's identity in which a computer user is granted access only after successfully presenting multiple pieces of evidence to an authentication mechanism. Rather than thinking of security measure that protect the organization and its customers as a hassle, MLS operators should consider the financial and reputational harm a data breach could cause.

Making matters worse, wire fraud has become a problem across the industry. Home-buying and selling creates complex transactions involving a title company, attorneys, brokers, banks and consumers; and all stakeholders need to communicate responsively and effectively. As a result, spearphising attacks from what appear to be trusted sources asking buyers to wire money to another location at the last second have become prevalent across real estate as buyers are cheated out of their hard-earned money.

To combat the issue, the Information and Real Estate Services (IRES) platform now allows brokers to upload a wire fraud disclosure that essentially says buyers will never receive wire instructions from their broker during the transaction.

PRIVACY

With the rise of smart, voice assistants like Alexa, Google Home and Siri, privacy has taken center stage. Consider this scenario:

You really like a house you're touring and stop around the kitchen table to quietly discuss it with your significant other. The house seems too good to be true for the price it's listed at. If the seller has their voice-controlled smart speaker ramped up, they could hear that statement and choose not to negotiate before they ever get an offer. Or vice versa, if you feel a property is overpriced and say so, you've already shown your hand. In short, if you aren't aware of the presence of these devices, it raises privacy issues and can put your negotiation strategy at a disadvantage. The real estate industry and MLSs need to consider how they will handle disclosing the use of recording devices during showings.

COLLABORATION

The real estate market in Colorado is competitive, and the business is unique – competitors must cooperate with each other to ensure a successful transaction. Consequently, MLS systems facilitate that cooperation. 

Unfortunately, as MLS administrators, we often become so entrenched in our daily operations that we forget to step back and look at the big picture. There are numerous opportunities for our organizations to work together to make our jobs easier. The majority of MLSs operate on similar programs with overlapping features.

Why couldn't we collaborate on training?

A lot of the resistance stems from the artificial boundaries the industry creates and wants to protect. Because MLSs within the same state often view each other as competitors, collaboration can be a challenge. But when real estate information is not shared between MLSs, it creates a barrier. However, when MLSs elect to collaborate and exchange information, it broadens the information available to everyone and improves the industry as a whole.

Take the relationship between Metro MLS (Wisconsin) and ARMLS (Arizona) as an example. The collaboration between two non-contiguous markets meets a national necessity for MLS consolidation that finally provides a more customer-centric approach to real estate. The two organizations are combining support, data integrity, product licensing and other services to serve all brokers and agents better.

Despite the thousands of miles between the two organizations, they discovered multiple similarities and by virtue of consolidation and being located in different time zones, each organization’s customer service line could be available to customers for a longer period of time. By looking outside of the box, the two MLS organizations were able to collaborate to improve so they could ultimately provide better services to their brokers and consumers.

Technological advances ensure physical separation is no longer a barrier to collaboration and innovation. And by maintaining their respective locations, this partnership can uphold the integrity and trust each MLS has built within their local marketplaces.

Within Colorado’s borders, a pair of MLS organizations are working together to evolve and innovate their platforms, ultimately addressing broker pain points to ensure all stakeholders —brokers, homebuyers and home sellers — continue to benefit. IRES, a regional MLS based in Loveland, and Colorado Real Estate Network (CREN), a regional MLS based in Montrose, have teamed up to host a series of “Colorado Conversations” with MLS executives and administrators from around the state.

As real estate continues to evolve in the face of technological innovation, it’s important to keep up with relevant advances that make our jobs easier and eliminate traditional industry pain points. Today, technology is changing how real estate is delivered to the consumer and how brokers manage their daily lives. Additionally, both IRES and CREN are constantly in search of new ways to partner or collaborate with other organizations with which they are aligned. Through these conversations and other collaborative efforts, those of us in the MLS industry are eliminating industry pain points to create a better marketplace for customers and improve the homebuying and selling process for everyone involved.

In the end, when the MLS community collaborates with one another, we’re all ultimately stronger. Whether discussing cost savings or administrative efficiency, access to data or new technologies that can benefit customers and make brokers' jobs easier. The real estate industry needs to get out of its own way and consider what the end goal truly is — homeownership, an essential piece of the American dream.

Lauren Hansen is the CEO of Information and Real Estate Services (IRES), a regional MLS based in Loveland. 

Jeff Follis is the CEO of the Colorado Real Estate Network (CREN), a regional MLS based in Montrose.