The Cendant Real Estate Services Division has issued a white paper titled "The Emerging Issues Posed By The Misuse Of Virtual Office Web Sites (VOWs): The Potential Downside OF VOWs" which outlines the franchise giant's strong positions on how it would like to see the NAR leadership vote on the issue of VOWs.

Cendant would like to see three conditions met by VOWs:

1. That they are subject to an opt-in/opt-out requirement
2. That they are not allowed to charge referral, advertising, processing, or other service fees in connection with consumer leads to other real estate companies
3. And that they are prohibited from entering exclusive relationships with other real estate companies to give preferred office leads

Without an opt-in/opt-out requirement, argues Cendant, "there is a likelihood that local brokers will seek to avoid sharing listings with the applicable MLS in order to prevent otherwise unauthorized incorporation of the listings into third-party VOWs."

To date, this is the strongest dissenting vote ever cast on the topic of VOWs.

Cendant leadership is focused on the use of some VOWs to charge referral fees to brokers who help supply the VOWs with listings via the MLS database. They want such practices stopped.

The corporation's white paper makes its case by stating that both IDX (broker-approved publication of listings) and VOWs present the "potential to undermine the profitability of real estate brokerage firms and increase costs to consumers." Cendant and its brands state that they strongly believe "that the unregulated proliferation of VOWs will ultimately increase the cost to consumers and hurt the economic viability of America's real estate brokerages. Further, the company says that proponents of VOWs are "engaged in a subterfuge, the purpose of which is to mask attempts by third-party aggregators to create non-value-added revenue streams solely for their benefit."

The paper describes differences between IDX and VOWs, calling IDX "nothing more than a limited electronic MLS book allowing consumers to view basic information about any number of properties across a local marketplace," allowing consumers to seek a single source for listings, cutting home search times. They also allow brokers new Internet outlets for advertising their listings, inexpensively.

VOWs, as defined by the white paper, "differ from IDX by essentially taking the IDX platform at least one step further." VOWS are "private business platforms that are designed to facilitate actual transactions" by registering consumers and delivering them as leads to other companies and sales agents, in some cases.

VOW technology, along with policies that promote the same, "creates an opportunity for large third-party service providers such as Internet Web sites and search engines to obtain real estate brokerage licenses ( or align with other licensed brokers) and subsequently aggregate real estate listings." The size and marketing power of these aggregators make it not feasible for a local real estate company to compete. Consumers would make these aggregators the "go-to" site, giving the sites the ability to create "a for-profit business model whereby they would register these...consumers, and ....hand off such...leads to local real estate brokerage offices."

To view the white paper in a PDF file, click here

The white paper has already been sent to NAR leadership, and the franchise giant's real estate division CEOs say their position speaks for many independent brokers in the industry.

Published: March 5, 2003

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Blanche Evans is the award-winning senior editor of Realty Times, the Internet's leading independent real estate news service. She is featured daily on the Realty Times Video Network in the "Realty Viewpoint" segment. Blanche has been named one of the "25 Most Influential People In Real Estate" by REALTOR Magazine, and has been twice recognized as a "notable." In 2005, she was named "Top Reporter Covering the NAR" by Delahaye-Bacon's. Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. To contact Blanche, email her at . For more articles by Blanche, click here.