Tag Archives: CREA

Real Estate as Platform: Canadian Real Estate Industry looking for developers

As some readers know, I’ve been asked from time to time by members of the real estate industry to comment on the future of their industry, how technology might impact it and how open data (both the government variety, and the trend by regulators to make the industry’s data more open) may alter it.

It is with some interest that I point readers, as well as software vendors and others, to this Request for Information (RFI) issued by the Canadian Real Estate Association yesterday. The RFI is titled: A National Shared Development Platform and App Marketplace and this line from the RFI is particularly instructive:

This Request for Information (RFI) is issued by The Canadian Real Estate Association (CREA) to qualified service providers who may be interest in creating a National Shared Development Platform where certified, independent software vendors (ISVs) and data providers could develop, extract and combine data to generate new tools and services for REALTORS® and their clients.

In other words, from my reading it looks like the industry is seeking a data sharing portal that can serve as a platform for internally and externally driven innovation. It is very aligned with what I’ve been suggesting, so will be interesting to see how it evolves.

Intrigue.

 

And Now… Another Message on Open Innovation for Realtors

Over the past few months I’ve given a number of talks on open data and open innovation to groups of realtors around the country. During these talks I have cautioned that the more the real estate industry tries to protect (e.g. not share) its data, the more it risks making access to data (control) be the source of competition as opposed to accessibility with the data (allowing others to create value-added services).

Consequently, recreating already existing data sets will become the goal of competitors if working with the real estate industries data to innovate new services is not possible or prohibitively expensive. Competition on this axis has, I believe, two possible outcomes: One is a winner take all world where the person with the biggest data set wins, or put another way, either the current monopoly maintains its grip or a new monopoly takes over. The other is that there ceases to be, in a meaningful way, a single data repository on real estate and market place data gets broken into lots of different silos. This implications of this outcome are less clear, but there is a risk it could be bad for consumers as, essentially, market information would be fragmented. In either case, both outcomes carry significant risks for organized real estate.

Despite this, many realtors don’t believe it is likely to happen, because they don’t believe their data can be duplicated, no matter how much I try to tell them otherwise.

But…. whoops! Look what happened!

Today, as if to hammer home what I believe is the inevitable, the Globe and Mail has an article today on a new service that allows one to get an estimate on the assessed value of one’s home by accessing an alternative data set (one essentially created by the banks). It is basically a data set that is outside of any owned by organized real estate (that found in MLS). Look! Someone has recreated what was previously seen as a data set that could not be replicated!

Of course the counter is: “It isn’t as good.” Well, two things here. First, it may not have to be. If it offers 80% of the accuracy and 20% of the cost then it will probably be good enough for at least part of the market. And once it is established, I’m confident the owners of the website will find ways to make their service better and the data more accurate.

The real estate industry has an opportunity to shape its future or be shaped by the future. The market (and the competition bureau) isn’t going to give them for forever to make up their minds.

 

What Canada's Realtors could learn from Canada's Lawyers

Lawyers aren’t generally known to be the most technologically forwarding looking group – but here in Canada they have done one thing really, really well. Making radically efficient the transaction costs around sharing critical information regarding their industry.

CanLI – the non-profit managed by the Federation of Law Societies of Canada has the goal “to make Canadian law accessible for free on the Internet.” In essence CanLI copies all of the materials produced by the courts, organizes it and makes it searchable and re-usable by anyone. For realtors wondering about their future, looking over this service might be a good place to start.

Consider MLS.ca (now rebranded as realtor.ca) the website run by the Canadian Real Estate Association (CREA) that shares information on what homes are for sale where. A few of you may also know that the Competition Bureau and CREA have recently been tangling over access to MLS. While the it is now easier for people to list properties on MLS, the data within MLS is very restricted. Much of the data only realtors can see and re-use of the data appears strictly verboten. These restrictions cause Canadians to suffer from what I like to call the Hulu Syndrome – they can see what a more open system would look like by surfing the various property websites in the United States – but they are stuck using MLS when trying to browse for a home to buy.

Canadian realtors wanting to know what the future looks like for a professional service in a world where data and information is widely available, CanLI offers both a window and a model. Unlike MLS, the great thing about CanLI is that it serves everyone, not just lawyers. It isn’t hard to imagine a world where lawyers insisted that only they can access the cataloging system they pay for (lawyers pay a small annual fee to support CanLI) much like only realtors can access the full database of MLS. In such world if you wanted to read a judgement, or view court documents on a specific case, only a lawyer could access it for you, and then they would interpret it for you, and, to carry the analogy to its logically conclusion, you would rarely or likely never see the original documents.

Thankfully for both the legal system, the market place for legal services and for our democracy, CanLI doesn’t work this way. As mentioned anyone can search, find and download all the information. Indeed, look at CanLI’s Terms of Use:

Subject to the following paragraph and the below conditions pertaining to prohibited use, legal materials published on the CanLII website, such as legislation, regulations and decisions, including editorial enhancements inserted into the documents by CanLII, such as hyperlinks and information in headers and footers, can be copied, printed and distributed by Users free of charge and without any other authorization from CanLII, provided that CanLII is identified as the source of the document.

Compare this to MLS’s terms of use:

This database and all materials on this site are protected by copyright laws and are owned by The Canadian Real Estate Association (CREA) or by the member who has supplied the data. Property listings and other data available on this site are intended for the private, non-commercial use by individuals. Any commercial use of the listings or data in whole or in part, directly or indirectly, is specifically forbidden except with the prior written authority of the owner of the copyright.

(Side note, I’m pretty sure you can’t copyright data – so not sure what the legal rights being exercised here are).

Of course, even though CanLI makes legal documents are freely available, many people still want to use lawyers because they don’t have time or, just as often, realize they need expert advice in this complicated field.

The same would be true of MLS. Many, many buyers will still want to use a realtor, although the buyers and sellers in the market place would be smarter and more informed – but this would probably lead to a better marketplace and happier customers. There are of course, a number of buyers and sellers who will simply freeload off MLS’s data to sell or buy their home on their own (much like some people probably “freeload” off CanLI to represent themselves or do research). But these are probably clients who would prefer to be doing it this way anyway – giving them full access to the database may cause them to a) realize they do need professional help or b) remove customers who don’t really want to use a realtor in the first place and are thus… terrible customers.

This isn’t to say that sharing MLS data won’t be disruptive, I suspect that some people will automate the buying/selling process which a percentage of the market place will prefer to a handheld process – but I suspect that, at some point, this will happen anyway (someone will figure out a model to make it work) at which point CREA and the realtors will have been firmly entrenched in the minds of Canadians as the obstacle to a better, more efficient marketplace, not the leaders who helped foster it.

Lawyers aren’t often known for clarity and simplicity, but clearly when they get it right, they get it right. I hope other professional services will look at what they are up to.