eRealty Cries Foul Over Realtors’ Rules

Independent realty Web site eRealty.com is crying foul over a new online listing policy issued by the National Association of Realtors (NAR).

The Houston-based eRealty.com is objecting to an “opt out clause” in the policy that allows real estate agents to withhold their listings from real estate “Virtual Office Websites” (VOWs).

The policy governs the display of MLS (Multiple Listing Service) information on the Internet and is set to take affect by the end of the year.

Sites such as eRealty.com, get many of their listings from the local MLS (multiple listing service) database that is available to all licensed realtors. The new policy could mean a reduction of inventory for these firms in the near future.

“It’s clear that Cendant and REMAX [two large offline real estate firms] were lobbying for and got a tool to protect their financial interests, not the interests of their clients,” said Russell Capper, president and CEO of eRealty.com said.

MLS is a proprietary system that only registered real estate brokers are allowed to post to and search on. However, there is no restriction on sharing MLS data among licensed realtors via email, paper mail, or FAX.

eRealty.com asserts the NAR, in treating the VOWs differently, is on the wrong side of the law.

“This is an anti-ecommerce position,” said Mark Hayden, director of marketing communications for eRealty.com.

“NAR’s new VOW policy guarantees that more consumers will be able to access more data over the web than ever before,” countered Steve Cook, a spokesman for NAR.

“I can’t think of another industry that is willing to put millions of assets for sale on the internet, and allow all its competing companies to share comprehensive data.”

In 2000 the Austin Board of Realtors went to court in an attempt to restrict eRealty.com’s use of the MLS on the Web. But in March of that year, a U.S. district court in Texas sided with eRealty.com. “The court finds all these methods of distribution [email, FAX, paper, and Web] are equivalent,” wrote Judge James Nowlin.

Withholding a listing from a VOW requires the consent of the seller. All licensed agents get the MLS, and Hayden speculated that listings might come with special notes attached that prohibit display on certain Web sites.

He also said that the NAR, as the licensing and regulatory body for realtors, could institute fines and other sanctions for non-compliance. But Cook said enforcement of the policy is up to local MLS database providers.

Cook also defended the policy as one that helps protect sellers’ privacy, while giving the data content providers, in this case the brokers, have a say regarding where their listings are posted.

“I can’t think of another industry where data content providers turn over their content for free and without any controls over how the data is used,” he added.

Hayden said eRealty.com had not decided whether to challenge the new NAR policy in court.

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