Nothing is more frustrating for a buyer than to call a Realtor only to find out that the home in question is already sold and has been for two weeks, a fact that has gone unreported to the local Multiple Listing Service (MLS).

This kind of lapse of service, not to mention lack of professional courtesy, is not only a reflection of the individual Realtor; it also puts in a bad light the MLS, whose responsibility it is to maintain and report the latest listing data. In response, some MLSs are stepping up the levying of fines against Realtors who don't accurately report and update data on MLS-listed homes.

Jonathan Hill is the director of administration with Metropolitan Regional Information, an MLS company that serves 22,000 Realtors in parts of Maryland, Virginia, West Virginia, Pennsylvania, and Delaware. He says emphatically, "We aren't thinking about it; we are already doing it. Our whole system is based on automatic debiting -- we don't invoice for quarterly fees. When agents sign the subscriber agreement, they agree to do certain things, and one of those things is submitting accurate, updated data. We definitely fine for out-of-date information."

How does poor housekeeping prevent an MLS from doing its job? By contaminating the integrity of the database information. By selling the database information to third parties, revenue generation subsequently is put at risk.

"It is definitely in the economic interests of the MLSs to maintain the integrity of database and encourage compliance, due in large part to the proliferation of third-party site licensing agreements," explains Bill Stegall, CEO of the San Diego-based Sandicor MLS. "One of the things we are discovering is the value of the database. Let's assume that we strike a deal with Dataquick or any similar type of company who uses our information to provide CMAs to their clients. If the database is distorted, then the accuracy of the database comes into question, which raises questions of its value to third parties."

Jim Speer, vice president of MLS of Long Island, a subsidiary of the Long Island Board of Realtors, says, "We levy fines ... however, the problem is that in reality, we don't know that the information is incorrect, and unfortunately in our area, agents don't take the time to let us know.

"I would estimate that at any given time, about 5 percent of our listings may be incorrect," he continues. "But when you look at the raw numbers, it seems higher. We have a tight market, so our listings are down to about 26,000, but out of those, about 1,300 are inaccurate. The brokers and agents complain about it, but they don't take the time to call us for specific examples of abuse. That's a shame because the MLS really is the agent and broker."

So if Realtors aren't willing to police themselves, what is the cost of noncompliance? "If we do find a violation, we will fine about $75," Speer says. "Our goal is to have the most up-to-date information possible, but today, agents just aren't paying as much attention. Fewer come to meetings, and they just don't hang on our every word like they used to. But the result is that it fails to produce good information, which hurts when it is time to get comparables, and it wastes time."

Why do some Realtors have such bad manners? According to Speer, Realtors who are called on the carpet offer three popular excuses: They say they thought the change was already made (by whom?), they don't know how to use a computer to make the changes (then why are you in an information industry?), or they don't have the time (no time to protect the integrity of the industry, the brokers, and their own reputations?).

Some Realtors are calculating as well as thoughtless. They feel they have nothing to gain by removing a listing on time or announcing a home is sold on the off-chance that they may still get calls on the property. Since the property is no longer available, they then have the opportunity to direct the caller to another property "just like that one or even better." They know that the odds are high that they won't get caught because the MLS won't know unless someone else reports the incident.

On examination, these excuses don't hold up because they don't jive with the Realtor's fiduciary responsibility to the sellers and buyers. Isn't the Realtor in charge of the listing? And if a Realtor isn't interested in taking the time to learn the skills required by the industry or to do the right thing to keep information flowing smoothly, then why is he or she in this business? More important is the question increasingly being asked by buyers and sellers: What value are Realtors?

The advent of Internet technology and the availability of MLS listings to be viewed internationally on home-search sites such as Realtor.com has put a spotlight on the problem. Consumers are taking more of a proactive approach in finding homes and will often call Realtors for more information after -- not before -- finding a home on the Web. Their expectation is that the information found on the Web is the most up-to-date and accurate information available. They simply don't understand or care about the communication breakdown that can exist between Realtors and the MLS. The MLS doesn't originate data; they organize it and make it public. It's the Realtor's job to "keep house" -- removing expired listings, showing price reductions as soon as they are given, or giving notice of contracts pending.

"Every agent whose house goes under contract is supposed to notify MLS within 24 hours," says Jay Burnham, a Massachusetts Realtor. He agrees that it's time for MLSs to start cracking down on these agents. "I support the MLSs in levying fines," he says. "It wastes time and makes the whole industry look bad when information isn't up-to-date."

As power continues to shift to the consumer in information dynamics, any lack of service only perpetuates the what-good-are-Realtors?-commission-cutting mentality of many buyers and sellers. And that is something the industry simply doesn't need. Realtors are already besieged on all fronts with efforts to reduce their commissions by their own companies, consumers, and other parties who fail to understand or value the extensive services that Realtors can provide.

Whether you support or object to noncompliant Realtors being fined, most of us agree that Realtors don't need to hand anyone ammunition on a silver platter.

Published: December 7, 1998

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