All Powerful Moderator
yeah we are in middle of it. Its not easiest of processes and contracts. Def not in interests of some great sites out there like leasebreak.com for example, Phil has been 'for the industry' for yearsREBNY continues to push boundaries (and it's luck?) by trying to steamroll agents, vendors and who knows who else. I still don't see a serious effort to walk the "data integrity" walk rather than just talking the talk.
Listing management providers aren’t thrilled with updates to REBNY’s terms in a dispute that could affect the city's residential brokerages.therealdeal.com
No signature, no listing service: Vendors balk at REBNY’s new data agreement
Brokerages could lose RLS access if their listing management providers don’t sign by Nov. 15Tension is brewing between the Real Estate Board of New York and vendors over changes to its data licensing agreement — a dispute that could threaten brokerages’ access to its Residential Listing Service.
Some vendors are pushing back against a new licensing agreement that may determine whether brokerages will continue to have access to the syndicated service through their listing management providers, or LMPs.
LMPs are vendors that act as middlemen on the back end, transporting listings from brokerages to the RLS. Examples include RealPlus, On-Line Residential, RealtyMX, Perchwell, BrokersNYC and RESoft.
According to documents exclusively seen by The Real Deal, the new agreement calls for LMPs to pay data licensing fees, take on additional roles to protect the RLS from third parties and resolve RLS technical issues in exchange for RLS access.
The agreement could cost vendors thousands of dollars. And given that REBNY can kick them to the curb at any time, some are worried about what it could mean for their clients’ listings in the future.
While either party could end the agreement should the other side breach the contract, REBNY can terminate it at any time, without cause, so long as it gives the vendors a 30-day heads up, the agreement reads. Upon termination, vendors would be compelled to return RLS data to REBNY and rid themselves of any RLS data they had at the time of the agreement.
“The current REBNY proposal imposes substantial reporting obligations on vendors and marketplaces, shifting significant risks onto all of the technology partners in their ecosystem,” wrote Lee Lin, founder and CEO of RealtyHop and RentHop, consumer-facing listing sites which partner with REBNY’s RLS.
Business on the back endBuyers or renters seeking a new home can log onto portals like Zillow’s StreetEasy or brokerage’s websites to view thousands of listings, regardless whether they belong to that firm or not. It’s why someone can log onto Compass.com, for example, and see listings courtesy of Corcoran or Douglas Elliman.
REBNY launched RLS syndication back in 2017, partly in response to new fees and ad features on StreetEasy, which had gained a dominant position in the absence of a centralized citywide listings service. REBNY’s RLS lets brokers choose which websites they want their listings syndicated to. (The Real Deal has a property listings portal that partners with the REBNY to provide free property listings to brokers.)
Several players work to get that listing data from one place to another. Brokerages send their data to LMPs, who then send it to REBNY’s RLS. LMPs then pay a nominal fee of roughly $4,000 to distribute that data back to their brokerage clients, a REBNY representative said. From there, brokerages can access a portal and choose which of several RLS-approved consumer-facing sites they want to opt in to.
The data itself isn’t perfect, and REBNY has taken steps to curb inaccurate and unlawful data in the syndication service. It has yet to have one solid consumer-facing site of its own, though there were previously talks of a deal with Homesnap that would have had one up and running earlier this year.
“The brokerage community has foolishly supported StreetEasy to a point where this might not ever change. I don’t know if anybody can do anything with data to supplant StreetEasy,” said William Sherman, president of the brokerage ShermanNYC. “At the end of the day, StreetEasy generates leads and money. All these other portals have yet to drive significant leads for anybody.”
Under these circumstances, REBNY has prioritized the backend. In June, it announced that consumer-facing sites would have to pay $3,000 a year for its syndicated listing feed to offset the building and maintenance costs that come with running the RLS. Weeks later, it announced a partnership with CoreLogic’s Trestle, which aids in the transference of data between the RLS and the LMPs.
A smooth moveLast month, REBNY informed residential brokers of additional back-end changes. On top of the implementation of Trestle, it is migrating to a new data transport system called Real Estate Standards Organization — or RESO — Web API from its previous system, Real Estate Transaction Standard, or RETS, which dates back to 1999.
“These operational upgrades will modernize and streamline the RLS in line with the many other listings services nationwide that are already beginning to move in this direction,” wrote Ninve James, senior vice president of REBNY’s RLS.
The original plan was to have all vendors transition to RESO by Sept. 30, but the deadline was extended to Nov. 15 to allow them more time. Since vendors must sign the updated data licensing agreement before migrating, the extension also allows for more time for discussion, should they want to address any concerns with REBNY.
Such an update is standard protocol, a REBNY representative said, and initial changes were met with positive reactions from RLS-member sites and vendors a year ago. REBNY is not concerned about vendors not signing the agreement in due time, adding that if they don’t comply, their brokerage clients would suffer, a representative said.
When asked last week whether all LMPs had signed the agreement, the representative declined to comment. A representative from RESoft confirmed that it has signed the agreement, while other vendors did not respond to requests for comment.
The new rules
LMPs only have access to the listings of their brokerage clients. If they want access to all listings, they have to go through REBNY. But with great RLS access comes great responsibility: According to the agreement, LMPs would have access to the listings in the RLS as long as they pay fees, ensure that they work smoothly and are protected from third-party access.
The data licensing fee that all LMPs must pay costs $3,960 a year, but additional costs could amount to much more than that.
An Internet Data Exchange, or IDX, licensing fee and a Virtual Online Website, or VOW, data licensing fee would each cost vendors that use those services an additional $2,500 annually. Vendors will also be charged a fee of $3,060 per year to use CoreLogic’s Trestle service.
Part of keeping those listings safe, as stated in the agreement, means regular security testing and audits incurred by REBNY, including a $500 IDX annual audit fee and a $2,500 VOW annual audit fee.
“As far as I know, we are one of the largest RLS marketplaces, and our team of 15 needs to spend resources to keep up with the annual changes,” RealtyHop’s Lin said. “I imagine smaller sites and vendors have a much harder time.”
Failure to pay the fees would cut off vendors’ access to the data. The vendors are also responsible for purchasing insurance should a third party gain access to the data.
The fact that the trade organization can expel vendors at any time has some of them hesitant to sign, saying that the agreement would put their clients at risk. Without these vendors, though, the brokerages and the RLS would have nothing, and the damage to the industry would be “devastating,” a source familiar with the matter said.
What’s at stakeIf the agreement isn’t signed by the time everyone migrates to the new system on Nov. 15, brokerages will be at risk of losing access to other firms’ listings, as well as their ability to update the RLS with their own listings.
When asked what this could mean for their business, Compass, Corcoran, Brown Harris Stevens and Warburg Realty each declined to comment. Douglas Elliman did not immediately respond to a request for comment.
One former LMP that confirmed they will no longer participate is the lead management firm Funnel, previously known as Nestio. But that company’s growth has been driven by multifamily property managers and its broker business has shrunk significantly over the years.
Switching over to the new RESO platform would have required the company to totally rebuild its integration with the RLS, according to Funnel CEO Tyler Christiansen, something that just didn’t seem worth it.
“The recent technical changes which the RLS has made would have required significant development work for Funnel,” Christiansen wrote. “Therefore we made the difficult decision to no longer be an RLS listing service provider.”
Brokerages that worked with Funnel were immediately notified of its decision and have the option to change providers.
Lin said that he’s sent REBNY feedback regarding the agreement and is awaiting a response. It’s no surprise that the agreement has received pushback, he said, calling it a “drastic departure from the prior year contracts.”
Still, he said his company is supportive of the RLS in its effort to support smaller brokerage firms in getting exposure for their listings. When it comes to the $3,000 fee his company had to pay, he said he doesn’t mind it as long as the platform undergoes improvements.
“In short, yes, some of the changes are annoying, but perhaps they are necessary,” wrote Lin.
Not all listing sites agree. In an email to agents last week, Phil Horigan, founder of New York short-term rental marketplace Leasebreak, announced that the site will no longer take the REBNY RLS feed, effective immediately. It was one of the first three websites to take the feed.
“We felt we could no longer take the RLS feed once REBNY made the surprising decision to start charging websites to show your listings,” Horigan wrote in the email.
Horigan added that while he believes REBNY wants the best for its agents, he disagrees with the decision to start charging websites like his, which send agents tens of thousands of free leads each year.
Agents can instead post their exclusive listings to Leasebreak for free, either manually or automatically in some cases. Leasebreak will also send 50,000 free leads to agents annually.
“Agents need every advantage they can get in a world where StreetEasy and Zillow have monopoly power and are clearly not afraid to use it,” Horigan said.
Agreed. Add in - agents listing on SE days/weeks prior to listing with RLS as well. Big issue here.The REBNY feed will always have data integrity issues as long as they only pay lip service to accuracy rather than actually enforcing strict protocols (like allowing fake unit numbers to cover up listing history, "potential" room/bedroom count based on fictional alternate floor plans, etc).
Be careful, read the fine print, and act accordingly. In my experience, Zillow/Streeteasy is not a good business partner.Texas is a really interesting submarket because, as I understand it, sold prices aren't necessarily easy to get publicly, so brokers who have pricing info have a competitive advantage. I'm contemplating using one of the StreetEasy lead generation programs, which I've never done before... curious to see what will jump out at me from the nooks and crannies.
Bullies.StreetEasy listings that are not posted within 24 hours of being publicly advertised elsewhere will be blocked from the site.therealdeal.com
StreetEasy to ban listings, rather than agents, that break its rules
Platform reduces penalty after backlash over exclusivity policyCompass agent Phillip Salem had a listing that he wanted to keep quiet, so rather than post it on StreetEasy, he put it on his own firm’s “coming soon” platform.
When StreetEasy found out, it retaliated by banning the agent from using its platform for two weeks. The city’s dominant listings site does not allow users to post properties elsewhere first, a policy it bills as democratic but Salem considers unfair.
“If a client decides that they want to be private, I think it’s up to the seller,” Salem said. “If StreetEasy [is] so concerned about people, they should be more concerned about how the client wants to list their property.”
Last week, StreetEasy took a step back.
In 2020, the Zillow-owned platform had told agents to post their sales listings on its site within 24 hours of advertising them elsewhere or they could lose professional access to the site. The new policy bans the offending listings, not the agents, meaning they can still post other properties on StreetEasy.
Although the revised policy is less aggressive than the old one, agents still don’t like it. For StreetEasy, it is part of a balancing act of maintaining its dominant position and maximizing revenues without upsetting agents — who are customers — too much.
“Punishing the agent for not feeding the machine within hours is definitely raising some eyebrows,” David Avgi, CEO of Avenues Real Estate, said in an email. “If I work for you, or if you pay me to do it, then I get it. But a service provider who tells you how to act on your yet-to-exist listings is somewhat questionable.”
Under the policy, a listing is considered publicly advertised if it is sent to the RLS, syndicated to a third party site, made available to the general public on a website or shared with third parties via email, according to a StreetEasy spokesperson.
“New Yorkers trust StreetEasy to help them find their next home, and they deserve access to the most accurate and up-to-date listings available,” the spokesperson said in a statement. “It’s why we have policies like this in place to hold ourselves — and all of our partners — to the highest data standards, ensuring customers are receiving the best possible experience every time they visit.”
Not everyone sees it that way.
“This is them trying to create an ironclad de facto MLS,” said Donna Olshan, president of Olshan Realty. “They are seeking to make StreetEasy as powerful as possible.”
With listings scarce and flying off the market, sometimes within days of posting, some view the update as an attempt by StreetEasy to ensure it gets a piece of the action.
“There’s no question that this is a hot market with very little inventory. StreetEasy is simply looking for another advertising edge compared to the other search engines where they can capitalize and make more money,” said Jamie Safier, a top agent with Douglas Elliman.
In a memo to staff after StreetEasy’s 2020 announcement, Brown Harris Stevens CEO Bess Freedman called its “strong-arm tactics reprehensible.” In an interview last week, she deemed the new policy “some momentum in the right direction” but still inadequate.
“Everybody feels like they’re powerless against aggregators, in particular StreetEasy,” Freedman said. Agents “want to be able to do what they want with the listings that they’ve worked hard for, and being penalized in any way is unfortunate.”
Safier said agents have also been hearing “chatter” about the Real Estate Board of New York’s forthcoming residential listing service, a partnership with Homesnap. REBNY calls the service, dubbed Citysnap, the “most complete inventory of residential real estate listings in New York City.”
It is expected to launch in the second quarter and could give StreetEasy a run for its money.
StreetEasy has not said how it will enforce the policy. “They would have to go out and create something that scrapes the data … and matches it up with what they have in their database,” Olshan said.
Even with the market as hot as it is, StreetEasy’s dominance as a property search engine in the city leaves many agents with no choice but to abide by its rules.
“Agents will tell you that they just despise StreetEasy because they feel like they don’t have a choice and StreetEasy will monetize everything and anything,” Freedman said. “The agents feel they’re really pushed back into a wall.”
there will be some Generational buying opps this year with this selloff: rdfn at 8.50, comp at 4, expi at 12, zg at 35
From Mike DelPrete
Zillow Flex Grows In a Cooling Market
Zillow and realtor.com's Q1 results shine a light on two key factors: overall revenue growth is slowing in a cooling market, and Zillow's next gen lead gen business, Zillow Flex, is building momentum.
Why it matters: Zillow is going all in on next gen lead gen; it's an important evolution of the real estate portal business model, and perhaps the singularly most critical component of Zillow's future growth (Zillow 3.0: Back to Basics).
- Revenue growth in Zillow's Premier Agent business, which includes Flex, has slowed, and is projected to remain relatively flat in the months ahead.
Zillow's plan is to double premier agent revenue by 2025.
Comparatively, realtor.com's revenues are also flat, and its next gen lead gen business accounts for a similar amount of revenue as at Zillow (28 vs 25 percent).
- It's far too early to pass judgement, but the results highlight future challenges -- and that Zillow will need to do something new to re-accelerate its business.
But growth rates are radically different. Zillow's Flex revenues increased 200 percent from the same period last year, compared to an 18 percent increase at realtor.com.
- Meanwhile, revenue in Zillow's traditional lead gen business dropped (!) 10 percent during the same time, compared to growth of 3 percent at realtor.com.
The evidence supports the narrative that Zillow is going all in on next gen lead gen.
Yes, but:Even though traffic and lead volumes are down at the portals (22 percent lower for realtor.com), overall lead gen revenues are up (7.5 percent at realtor.com and 9 percent at Zillow).
- It's extremely unlikely that Zillow will hit its 2025 targets with traditional, market-based pricing; it's all about Flex.
The bottom line: It won't happen overnight, but the future of Zillow appears very much tied to the future of Flex
- The portals always win: In a slowing market, agents are paying more money for fewer leads.