Scouting Report goes public
More than a dozen major markets now feature Realtor performance data for public consumption in the form of their new “Scouting Report” which currently offers data on a million agents based on information from local multiple listing services. Redfin CEO Glenn Kelman notes the helpful nature of consumers accessing the data to see which agents have had success in their specific neighborhood.
The Scouting Report data goes back three years and features all agents in each MLS that has allowed the data to be released to the public, not just Redfin employees. “I think the best real estate agents are going to love this,” Kelman said.
MLS restrictions mean the data is unavailable in Seattle where Redfin is based, along with other markets such as New York, parts of Atlanta and parts of California. Redfin pays each MLS for the data and continues to operate as a real estate brokerage.
Seattle agent says Redfin manipulates reports
The irony that the Scouting Report is unavailable in Seattle is not lost on all. Seattle broker Marlow Harris says that Redfin routinely manipulates agent data to appear more successful than they actually are. “In a recent Redfin transaction I was involved in, four different agents accessed the property on behalf of one buyer, but none of those agents were the one who finally wrote up the deal. Yet that sale was attributed to the agent who wrote up the transaction, not the agent who showed the house. How then is this an accurate accounting of that particular agent’s sales? Doesn’t this mislead the consumer into thinking that their individual Redfin agent is more successful than they are? I think it does.”
Harris continues, “Ultimately, this Scouting Report has the power to do the same thing. It will compare traditional agents with the Redfin office staff agents who get all the credit for a sale, but who actually share that accomplishment with a dozen other support and administrative personnel. For all their talk of transparency, Redfin should take their own advice instead of continuing to manipulate statistics for their own marketing purposes.”
San Diego broker notes Refin is not a charity
San Diego broker Kris Berg questions the legitimacy of how Redfin presents the data, noting that Redfin agents’ data is represented differently with buyers and sellers combined in their count rather than separated out as with non-Redfin agents. Berg said, “It’s important to remember that Redfin is first and foremost a real estate brokerage. They are not philanthropists or public servants. Their goal is to profit, not to selflessly educate and empower the poor, confused consumer. Publishing agent ratings online may or may not be a good idea, but if Redfin didn’t perceive it as a good idea for their business and bottom line, they wouldn’t bother.”
Various bloggers have weighed in, calling foul, while others are posting their own results as a medal of honor, while the real estate tech bloggers who have never relied on a real estate transaction to pay their own mortgage have decided that this move is a fierce innovation that is long overdue.
Realtor performance has been public for three years in some areas
Long overdue? How can that be, this concept is nowhere near new and has been in practice for years in various parts of the country. New York brokerage, Heddings Property Group has long offered a public list of all listings sold through their firm, but that isn’t exactly the same concept as revealing all agent information in a given market.
VVirginia area (including MD and DC) broker, and owner of FranklyMLS.com, Frank LLosa has been offering all agents’ data on his site for three years, a point which he made privately to Kelman, requesting that Redfin remove their blog statement that they are the first to provide the service.
Llosa calls his offering a Comparative REALTOR Analysis (Frankly CRA), a tool that Llosa told AGBeat has been one of his top negotiating tools since is 2008 launch.
Data manipulation and consumer perception
Like Berg and Harris noted, there are problems with the data, despite it being directly from the MLS. “One problem with this data is how easy it can be manipulated,” Llosa said. “Manipulation occurs when an agent will relist a home after each price drop to reset the DOM. This makes them look like rockstars with a 22 day average and 99% of “original” list price. Soon FranklyMLS will call out these relisters to recalibrate the data. I also call this Fat Free Fudge (legal relisting), vs Full of Fat Fudge (illegal relisting where you reset the DOMM and DOMP with a fake Tax ID#).”
Accuracy is not the only issue with agent data being public. It is a noble cause, according to some, and “innovative” (although, as we’ve noted, an old, tested concept), but Llosa says, “Another problem is the customer’s innocent ignorance on how to use it. A buyer agent isn’t worse if their average % of list price is higher (ie they were only able to negotiate 2% off vs another agent that averages 4% off). I have frequently won bidding wars with a 101% contract. That data doesn’t show you that we beat 7 other offers and some were as high as 104%. Saving my client 3%. Or a buyer agent lands a short sale after 9 months and it was 10% undermarket but they locked it up for 1% over list. Saving the client 9%.”
It’s not at all “outsiders” that are “innovating”
For all of the praising being done of “outsiders” innovating, it is interesting that everyone involved in releasing agent data is somehow attached to a broker license number. Redfin is a real estate brokerage in a tech company’s hoodie, while Frankly Realty and Heddings Property group are clearly and unquestionably real estate brokers.
Heddings and Llosa are not the only people who are or have attempted this “Scouting Report” theory. The Houston Association of Realtors made all performance stats of their members public after the board approved, then member outrage swelled and the data was taken down. This put a major hamper on the industry, as many looked to the HAR model’s rise and fall as indicative of what they would go through. In many association board rooms across America, publishing agent performance data has been discussed, voted upon and is still being considered, but with Redfin’s making noise, the boards will likely give up, leave the task up to its members, then in five years, add the feature to their own site and pat themselves on the back for being innovative.
AgentAquarium.com concept also beat Redfin to the punch
Recently, AgentAquarium.com approached AGBeat with news of their making agent data available in various markets, starting with Austin and soon to be Houston, San Antonio, Dallas, and eventually nationally. The founder said that when he moved two years ago, he had trouble finding an agent based on data and said everyone claimed to be “top producer,” a generic term that raised red flags to him. Months later, he began developing the site which has taken a year and a half to tweak out of beta. The site operates by agents signing up for their profiles and ultimately paying a 25% referral fee on any transactions done through the site.
The entrepreneur with a MBA negotiated with the Austin Board of Realtors (ABoR) for five months to gain access to the data, and say consumer feedback has been 100 percent positive. They said that one broker even asked AgentAquarium.com to manually manipulate his statistics, so he was removed from the site altogether, an admirable quality of a startup.
It was not immediately clear from first impression of the site that they are an active traditional real estate brokerage selling homes in Austin, which is, according to ABoR, the only way in which performance data is granted to any company. Governor Perry-appointed Texas Real Estate Commissioner Chairperson, Avis Wukash is on the Board of Advisors at AgentAquarium.com, according to their founder, but as of publication has not responded to our request for comment about the company, their compliance (as we were unable to locate any license number on their site), or regarding their representation of services. The concept is in line with Redfin’s Scouting Reports, but paying a referral fee for something now given out for free may be hard for agents to swallow.
Redfin woke up the sleeping industry
Redfin showed their “Scouting Report” hand to an audience of eager real estate technology fans long ago, but the industry was too busy tweeting or worrying about how many stars were next to their name on various websites to notice that their performance data was already going out to the public and was about to be done so even more publicly and on a national scale. Redfin may not have been the first to the finish line, but they certainly made the biggest splash in the agent performance arena, changing the game for Realtors as well as for other brokerages trying on the scientist/technologist startup hoodie just a little too late.
Story clarification: because our initial impression of AgentAquarium.com was that the company was just a tech startup, not a traditional brokerage, we spoke with TREC Legal and verified that they are in compliance with disclosures on the site per a statute updated in 2011. As mentioned above, they have access to the performance tracking data because they are in compliance with ABoR’s requirement that they are an active broker. We originally reported that the function of the business as an active real estate brokerage was unclear to us, but amended the story to give the company the benefit of the doubt, although that does not negate that the first impression of the site is that it is a Realtor search, not a competitive real estate brokerage. As of October 4th, former Texas Association of Realtors President, Avis Wukash has not responded to our request for comment on these and other TREC rules regarding disclosures, as she is serving on AgentAquarium.com’s Board of Advisors. AGBeat will be bringing this issue to the attention of the Professional Standards Committee at the National Association of Realtors.