Inside one MLS’s expansion push
There are many ways that industry leaders are attempting to address the challenges of the current MLS-broker relationship. This article explores how one MLS is pursuing expansion in an innovative way.
For a catalogue of the newer ways MLSs are collaborating, read February Insight article, “With deepening collaborations, MLSs embark on a new era.”
In Tennessee, Realtracs, an MLS with over 18,000 subscribers, is pushing to establish itself as a statewide MLS by going directly to brokers, who have much to benefit from an MLS that covers a broader geography.
The statewide push
In 2019, Realtracs, recognizing the scale and efficiency that comes with getting larger, and with the ability of many brokerage members to market their properties to a larger constituent, began reviewing its options. From its Nashville centered area, Realtracs, which is owned by seven local Realtor associations, has approximately 50 percent of Tennessee market coverage.
At the time, the state had 12 MLSs, but Realtracs identified only three MLSs and their local Realtor association owners in the state’s three other major markets to pursue a collaboration with: Knoxville, Memphis and Chattanooga.
The vision and the pitch to these three local associations, Realtracs CEO Stuart White told T3 Sixty, was that these associations would join the other seven owners of the MLS as equity owners. The result would be Realtracs owned by 10 local Realtor associations, and cover 81 percent of Realtors in the state. Equity stakes in Realtracs would be determined by the percentage of Realtors each association contributed to the full MLS membership.
The MLS approached the associations with an equity offer in the statewide push. All of them, citing interest in maintaining local control among other reasons, declined the offer.
In mid-2021, with a bunch of Nos from local Realtor associations in hand, Realtracs decided to pursue a different tack. It would go directly to brokers and offer them the choice of participating in and growing a statewide MLS.
Realtracs chose to start with Chattanooga, and the largest brokerage there, Keller Williams Greater Chattanooga, which has approximately 60 percent market share, according to the brokerage’s CEO Hope Brazzell. The brokerage has approximately 425 agents who do approximately 6,000 transactions and just under $2 billion in annual sales.
Keller Williams Greater Chattanooga is currently onboarding with Realtracs. The brokerage will work in both its local MLS and Realtracs for approximately 18 months, Brazzell says, and then may recommend its agents work with Realtracs exclusively, but will still support agents who want to list in the local MLS.
When approached by Realtracs, Brazzell said her interest was immediately piqued. She recognized that the ability to place her brokerage’s listings in Realtracs would give her agents’ listings more exposure than they got in their local MLS. Other reasons Brazzell had interest include:
Realtracs’ reputation for amazing customer support, customers and agents.
Realtracs owns its own proprietary technology
Its strong focus on education on technology for their agents and how they use it.
In addition to those features, Brazzell expressed an issue many brokers and agents site have with their local MLS: the line between the local Realtor association and the MLS it operates blurs where service and focus in each appears subpar.“When agents don’t know the difference between the association and the MLS, the line has gotten too blurred,” Brazzell says.
That was a big selling point for joining Realtracs, she says. It operates as a siloed business from the Realtor associations who own it. “It gives the MLS the ability to be an MLS, and the association to be an association,” she adds.
By joining Realtracs, Brazzell hopes that the local association will see the benefit the larger MLS provides and reconsider joining Realtracs and stop maintaining its local one: “Our hope is that the association will make some decisions about which MLS provider it would like to be in business with.”
White shares that hope, which underpins the whole strategy to begin with. Realtracs has begun to reach out to other brokers in Chattanooga and will apply the same strategy in Tennessee’s two other major markets.
“We want to serve the brokerage community better – if we don’t accomplish that, what’s the point of growth,” White said.
In recent years, MLSs have looked to expand in ways beyond consolidation. This approach by Realtracs, and other approaches other brokerages and MLSs are pioneering are playing a role in improving broker-MLS relationships and the experience of real estate consumers.