Organized Real Estate
Realtor associations, along with MLSs, are collectively referred to as organized real estate. They play a major role in setting industry professionalism; they advocate at the national, state and local level for homeownership and other issues that support their members’ business and manage local MLSs enable the buying and selling of houses, apartments and other real estate.
As trade associations, Realtor associations are nonprofits owned by their members. They represent their members and aim to help them improve the quality of service they provide, their education and professional standards. The classic Realtor association mission is simple: to make members more profitable and more successful.
Realtor associations come in three varieties, determined by geographic scope: national, state and local. Realtor associations have a federated makeup: members cannot join just one. When agents join a local association, to gain access to the MLS for example, they automatically join the state and national associations; the memberships are tied together in what is known as the three-way agreement.
The three largest state associations track with those states’ populations with California, Florida and Texas leading the pack and the only associations with membership counts above 100,000. Together, these three associations have 513,127 members (brokers and agents), accounting for 36.4 percent of the nation’s Realtor membership. As these three states only account for 26 percent of the nation’s population, this stat reflects the outsized role real estate plays in those states.
Membership in local Realtor associations is clustered among the largest. In the local association category, approximately a fifth of the nation’s 1,086 local residential Realtor associations account for 80 percent of the nation’s total membership. Surprisingly, California has no local Realtor associations among the nation’s 10 largest. Florida has three in the top 10 (Miami at No. 1, Broward, Palm Beaches and St. Lucie at No. 3 and Orlando Regional at No. 8) and Texas has two (Houston at No. 2 and MetroTex at No. 6).
In addition, many remain small; 384 local associations have less than 200 members, revealing, once again, the disproportions that exist in the organized real estate world. Smaller associations struggle to muster the resources to serve the needs of their broker and agent members.
Multiple Listing Services
Multiple listing services make homeownership happen. MLS creates connections that serve as a listing database for all a market’s homes for sale while enabling collaboration between competing brokers and agents to make transactions happen as quickly as possible and for the highest price. The nation’s nearly 565 MLSs essentially serve as cooperatives, the result of brokerages in a certain region coming together to collaborate on marketing and selling each other’s listings. MLSs are anchored by a technology platform, often provided by a third-party software provider.
The earliest MLS concepts emerged in the late 1800s when brokers came together to help each other by connecting one’s seller with the other’s buyer. By the early 1900s the precursors to the modern MLS started cropping up around the nation. Today, MLSs stand as one of the industry’s most widely, frequently used and most valued pieces of technology.
The MLS world is quite diverse, but, as with local Realtor associations, the biggest of the big stand in a class of their own and account for a bulk of the nation’s MLS subscriber count and subsequently the largest component of sales volume and transaction count. The nation’s large regional MLSs have huge footprints, sophisticated technology, innovative business practices and well-run management structures. The largest MLSs serve members across a broad geographic area, sometimes statewide or even across multiple states.
The new rankings show that the nation’s 20 largest MLSs (approximately 3.5 percent of all MLSs) serve over 50 percent of the nation’s total MLS subscribers; this number will likely go up as consolidation increases across the country. While MLSs have declined roughly 30 percent from just over 800 in early 2014 to 565 today, local pride and politics keep some smaller organizations alive. Eighty-two MLSs serve less than 100 brokers and agents, too small to effectively serve the growing, more advanced needs of their membership.
California Regional MLS (CRMLS) continues as the nation’s largest MLS while becoming the first organization to break into the six-figure member count at 101,502 subscribers. A number of strategic additions this past year have grown Bright MLS to 90,932 subscribers and Stellar MLS to 58,447 subscribers, making them the nation’s second and third largest MLSs, respectively