There has been a long standing battle in the realm of property search and things are heating up again. The National Association of Realtors (N.A.R.) just recently approved a franchisee “opt-in” requirement for displaying IDX listings on franchisor websites. Real estate company franchisors like Century 21, RE/MAX and Coldwell Banker are really just large brands that don’t sell any homes themselves. Instead they sell their brand names to regional real estate brokerages who run their offices independently under the franchisor banner.
With the Internet boom, it became obvious to franchisors that the web was the place to be marketing. As a result, these franchisors have put a lot of resources toward developing their own real estate portals to primarily feed the business of franchisees. Of course, every real estate website, regardless of size and scale, is dependent on the listing of homes to attract visitors and potential prospects. The home data featured is provided via Internet Data Exchange (IDX) agreements with local Multiple Listing Services (MLS) of which franchisee real estate brokers are members.
Per a previous N.A.R. rule change in January of this year, franchisors were permitted to showcase IDX data on their website by virtue of having a representative franchisee who was an existing local MLS participant. An example of one such IDX agent feed is on a website like this one for Highlands Ranch, Colorado real estate.
The previous rule change created some trouble, however, for a couple of reasons. Firstly, there are some franchisees that don’t want help from their franchisor in this regard. They have their own website portals for serving a regional area and didn’t want to be forced to compete with their own franchisor to garner website traffic.
Secondly, there are independent websites and companies that also compete directly with real estate franchisors for traffic. It is their view that the January rule change gave franchisors and unfair competitive advantage in advertising home data to which they were not entitled.
So as a compromise, the N.A.R. board pushed the new “opt-in” rule change through. However, the matter is certainly not settled and one can expect to see more fireworks as real estate companies, brokers and agents continue to struggle over the territories in the web space.
