V3 of MLS or the Maginot Line. Your choice!
By Terrence McDermott
National Association of Realtors
Back in the days when a Mobile phone was a three pound grey brick from Motorola emergency services, I visited the MIT Media Lab and the eminent Director and later author of “Being Digital” Nicholas Negroponte. The discussion was focused on computer aided design which led to a visit to the MIT Artificial Intelligence (AI) research lab. AI then was all about machine language, robotics and pattern recognition. Algorithms, first postulated by Alan Touring in 1954, were yet to become mainstream. The eventual escape from Math and Computer Science departments still had miles to go.
AI had garnered a lot of government funding in the US and U.K. and seemed to be on the verge of changing the world. But then the funding dried up. What followed was the era of “AI winter” with the exception of progress in manufacturing control systems, banking and healthcare. Spring finally arrived to the rest of the world in 1998 when Google launched and subsequently went public in 2004. Remember Google at 80 bucks a share? Can you believe it??
Now in the era of Block Chain ledgering, Big Data analysis and algorithm BOTS, AI is poised to add value to the MLS and the entire structure of Real Estate. V1 of MLS included listings. V2 included listings and public records. V3 is poised to be truly different. Count on it! And what makes this so compelling is that AI and MLS are natural partners since AI is basically object and pattern analysis and MLS is Big Data structured by object characteristics. So a BOT (intelligent agent) is designed to scour vast amounts of real property and associated data thus creating a giant leap forward for the MLS world into consumer content origination and of course agent value.
The opportunities associated with Big Data scope and growth coupled with greater technology investment will accelerate MLS consolidation. Plus it will create the financial strength and data insights resulting in best-in-class services at reduced cost to Realtor agents, brokers and consumers.
Getting past the turmoil that the new real estate business models and Realtor revenue models (created as the result of AI) will challenge everyone from NAR and MLSs to Broker Brands, Franchises, Mortgage, Title and technology vendors. Essentially the entire Real Estate ecosystem! This turmoil will keep Brad Inman writing millions of words for years to come.
But the larger storyline here is: If you defend the status quo, you are hunkered down in the Maginot Line and the tanks will maneuver around you.
An easily imagined end-point is a Sunday morning that goes something like this;
ALEXA, update the results of my MLS BOT search for water front property on the Eastern Shore.
ALEXA, text me the buyer agents most recently successful in my price range.
ALEXA, estimate what the sale of my condo in Stone Harbor on the Jersey Shore will bring net of fees and debt service to the new transaction.
ALEXA, send the request for proposal on the Stone Harbor property to the top producer list you identified.
Or maybe an entirely different question;
ALEXA what is the likelihood of the current NAR legislative initiative to restore the state and local tax deduction passing this year?
And on and on and on.
If anything seems too futuristic perhaps you should go on a Homesnap safari and see how accessible and transparent MLS data already is. Or test drive Remine to see Big Data visualizations that combine real estate information with all manner of consumer patterns. We are in for a serious game of musical chairs and indeed the AI technology wave will eliminate many with a current seat.
The ultimate winner is the consumer and those professionals in the Real Estate world who use AI to enhance their value proposition. These guys will win the consumer’s loyalty.
Change accelerates as we get closer to the vortex. So expect a dizzying ride. Do not fixate on current technology and its uses for it is the feint; the reinforced perimeter that seduced the French in the run up to WW2. Rather focus on the larger strategy and instead place your bets on reinforcing the consumer perception of your value to an efficient and successful transaction.