Residential Real Estate

Is The VOW Debate Finally Over?

For at least the past decade the National Association of Realtors has been trying to figure out how to handle the online distribution of homes listed by member brokers. Several Internet brokerages claimed that early NAR rules placed them at a competitive disadvantage, claims NAR denied and claims now put to rest with a proposed settlement between NAR and the Justice Department. Under the terms of the settlement with the Justice Department, NAR admitted to no liability, confessed to no wrongdoing and paid no financial penalty. Meanwhile, while lawyers debated the world of real estate marketing changed radically. The central issue between NAR and the Justice Department concerns so-called VOWs, or virtual office websites. With a VOW an Internet traveler gets to see online listings -- but only after registering with the site owner. By registering an online visitor may well be signing legal paperwork that commits him to be a "client" of the VOW site -- and thus with the click of a mouse obligated also to pay a fee to a VOW operator the surfer may not know, like or want. Most brokers today use a system called IDX (Internet Data Exchange) which allows consumers to see gobs of listings but without registering, without creating an agency relationship and without owing a dime to anyone. The IDX system works well for both brokers and consumers -- but it works especially well for local brokers who can physically show properties and who can talk in detail about the last five neighborhood sales. Why? Because real estate is a localized commodity, no two homes are alike and buying homes without an on-site walk-through can lead to surprises online photographs and videos may not reveal. As long as there"s a choice, consumers are not going to pay when they don"t have to and they"re not going to register if they can avoid it. In a practical sense, the debate over VOWs is like arguing over the best colors for 8-track tape recorders -- both technologies exist, and both are less relevant each day. For more articles by Peter G. Miller, please press here.

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