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How NAR got around the DOJ settlement by discouraging VOWs and hiding listings.

According to NAR there has been a lot of speculation recently about the 2008 settlement agreement between the DOJ and NAR.

Even though NAR reached an agreement with the DOJ, they successfully discouraged most brokers from using a VOWs by allowing the MLS to charge a lot more for them. In many cases it costs twice as much to put up a VOW vs. an IDX website.

This price increase means that companies that market websites to Realtors almost always market the IDX version. As most Brokers are not programmers and do not have a large IT staff, this effectively eliminated most of the Brokers from using a VOW. They had no choice, only IDX websites are being offered by the popular website vendors.

In addition, they added rules to a VOW that and IDX site does not have to worry about. One rule eliminates 80% or more of website visitors by forcing visitors to sign up before seeing all the data.

So it is no surprise that NAR has said “… we do not know how many VOWs are still operating today …”. The answer is probably very few. They could easily find out how many VOWS there are by simply asking the MLSs for a count of VOWs and IDX websites. I believe they do not want to do this because everyone will see just how effective their road blocks to having a VOW have been.

While they have taken some steps to make an IDX more effective by releasing some of the data they previously required an IDX to hide, they should take a final step and release all the data, as that is what consumers want, and it helps Realtors too.

By hiding withdrawn and expired listings sellers do not know what prices are too high. A seller might price their property higher, not realizing a neighbor tried the same price and after 1 year their listing expired. If they had that data, they could price their home correctly. Pricing a home right benefits the Realtor who now can sell the home instead of having it sit on the market, and the seller too.

You might say consumers can get that information from Realtors, so no need to give them access. I say the days of Realtors being the gate keepers to MLS data should be long over. Consumers have told us loud and clear they want access to all the listings, they do not want to be forced to go through their Realtor to get this data.

PS: For those of you interested in the future of VOWs, you may want to read this article Drew wrote at the end of last year.

About Bryn Kaufman

Principal Broker and creator of, one of the most popular websites on Oahu. I enjoy working with PHP, MySQL, jQuery, JavaScript, HTML5, Ajax and more. I am always looking to improve my Website and business. When not working, I enjoy spending time with my family and doing anything on or in the Ocean.

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  • Andrew Weinberger

    It’s a shame, but in an effort to keep control over their listing data all realtors have done is prevented their colleagues from accessing/marketing it effectively and given complete control to big aggregators like Zillow who do more harm than good. It’s hard to imagine how Zillow manipulating listings and inserting third party brokers is better for listing brokers than if we had fully a open IDX or VOW.

    • Good points Andrew.

      • “Zillow who do more harm than good.”

        Can you explain your thinking there? I certainly understand the industry downsides to Z, but doing more harm than good to me would mean one of the following statements would have to be true for consumers:

        1. Buyers have a harder time buying homes with the portal than without.
        2. Fewer transactions occur with the portal’s existence than if it wasn’t around.
        3. Sellers have a harder time selling homes with the portal than without.

        Are any of those true?

        • That is a big question and there could be a lot of debate about it.

          All Realtors who do not use Zillow do not like Zillow. So that could be where Andrew is coming from.

          Regarding 1 in some cases that could be true. When Zillow does not have 100% of the listings, or is not 100% up to date on all listings, it makes it harder for buyers.

          If buyers are looking at only 50% of the listings but think that is everything you can see that would be an issue which would make it much harder for buyers.

          I don’t have data for how accurate and up to date they are in each market. I know when I studied it once they had a lot of things out of date in my market, so buyers would have an easier time on a Realtor’s IDX site.

          I forget who was running those ads against Zillow but I think they understood the point. There are homes that are just not on Zillow, and that is not good for buyers.

          Regardless if Zillow is there or not buyers and sellers will do what they have to do. If Zillow disappeared tomorrow, there would still be the exact same amount of sales.

  • There’s a very different version of this story. It may require a full post, but I’ll try to synopsize it here.

    1. MLSs “Charge a lot more” for VOWs: The DOJ rule specifically prohibits imposing unreasonable fees or costs for VOWs. So while the cost for VOWs might be set higher than IDX by some MLSs in some cases (there are no numbers supplied in the post), the DOJ hasn’t seemed to see this as an issue.

    2. MLS IDX policy has become so much more open and flexible over the past 10 years that most brokers haven’t needed a VOW site any longer. NAR IDX policy was continually opened up to display pending listings, sold prices, even voice activated display of IDX listing data without user registration in what was once a VOW-only offering. These changes were much more likely to have caused the shift to IDX and resulting lack of VOW sites today.

    3. “Hiding withdrawn and expired listings”: Opinions differ on whether these should be displayed on IDX. Rather than being hidden, they are not currently displayed on IDX and, to my knowledge, never have been. I wouldn’t be surprised if this data becomes available via IDX at some point.
    In general, the more data we can supply to consumers, the better. If it’s not confidential seller information, we should be assessing IDX policy to see if we can add more kinds of data to the IDX and VOW feeds.

    VOW’s differentiation is merely registration via email address. It’s worth a discussion as to whether or not that still signifies a broker/client relationship today. The display policies of VOW and IDX may look very similar in the near future.

    I’ll be happy to give your feedback to the policy committee.

    • Thanks Sam, I would appreciate that. I also reached out to Bob Goldberg via Facebook and he did reply, so he is aware of my concerns too.

      Regarding 1 my local MLSs for the Big Island charges $99 a month for IDX, and $199 for a VOW. I am a database guy and I do not see the reason for charging twice as much.

      I don’t think the DOJ fully understands what happened to VOWS because of the higher costs.

      Regarding 2 I agree and I did mention they now release more data that was previously hidden. So I wanted to acknowledge a step in the right direction. When you say most Brokers have not needed a VOW you are right, but that is looking at it only from a Realtor point of view.

      As long as Brokers have enough data to capture leads they are satisfied.

      However, talk to the public about listings being hidden from them, and you will probably not find one person for it. Just in my little MLS, I found over 1,000 listings that are hidden from the public each year.

      I have been through a situation where my local MLS tried to hide listings, and I saw first hand how upset the public is at this. I read thousands of heated letters and comments asking the MLS why they would do this. They really hate the idea of important data being hidden from them.

      Regarding 3 hidden or not displayed to me is the same thing. They are hidden by the MLS refusing to provide them in the IDX feed.

      I agree with you the more data we can provide the better. Sellers will benefit when they are allowed to know what comparable homes expired because they priced them too high. Pricing high does not benefit anyone, so getting that data out there is important.

      In closing I would ask you and others try not to think about from the Broker point of view but instead think about it from the public point of view.

      This is how NAR got in trouble with the DOJ to begin with. NAR was just thinking about Brokers, and the DOJ came in and said NAR’s policies are not fair to the public.

      • It’s a good discussion, Bryn. NAR’s issue with the DOJ, though, was about being non-competitive amongst brokers with different business models. It wasn’t about consumer access in this case.

        That being said, our focus should be on better broker access to data so that brokers can deliver as much information as possible to consumers. We’re on the same page there.

        • Thanks Sam for your replies.

          I believe the DOJ issue was also about consumers. Here is a quote from their settlement press release which mentions consumers.

          They said the outcome of the settlement has the following benefits:

          “…resulting in more choice, better service, and lower commission rates for consumers.”

          • Again, good point, all noncompetitive issues are about a better marketplace for consumers. The MLSs needed to open access up to all models of brokers.

      • “Just in my little MLS, I found over 1,000 listings that are hidden from the public each year.”

        What exact type of listings are those?

      • “NAR was just thinking about Brokers”

        Of course they were, because brokers pay their bills. Brokers allows NAR to existence, and its employees to have jobs.

        • Right, but what I am suggesting is good for Brokers and consumers.

          NAR is a monopoly that has to consider how their actions impact consumers too.

          When they lost their focus on consumers the DOJ came in and corrected them.

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