Proptech’s Golden Moment: How You Can Be The Hero in a Post-NAR Settlement World

By the time you wake up tomorrow, the real estate industry as we know it will have officially turned on its head. Of all the stakeholders to this massive fiasco, the group that is in the best position to fix the mess wrought by the NAR settlement is… proptech software developers.

This may sound like hyperbole. It’s not…

Here’s the TL;DR:

Offer of commission is being removed from MLS listings.
Sellers can still signal they’re offering concessions. But no details.
Buyers’ agents have to get clients to sign a document acknowledging that they’ll need to pay the buy side commission directly.
The disarray caused by this change can (and will) be solved with software.

How we got here:

On March 15th, the National Association of Realtors (NAR) reached a $418 million settlement in response to a spate of lawsuits related to agent commissions. This was the largest settlement of its kind in the organization’s history. And today marks the line of demarcation between what will undoubtedly be referred to as life before the settlement and life after.

Starting tomorrow MLS listings will be stripped of commission details, meaning buyers’ agents will no longer be able to see what compensation is being offered on a given property. The impact to home buyers and the realtors who represent them has been talked about at length.

What has not been discussed is how the period of chaos that will inevitably follow will impact you, the proptech product makers, software developers, engineers and designers who constantly crave the next big problem to solve. Considering that realtors earned more than $80B in commissions last year–and the fact that the way they earned those commissions is now being completely re-written, this is certainly a problem big and bad enough for the best proptech minds to sink their teeth into.

Here are three game-changing product ideas that are just waiting to be developed:

1. A Portal for Commission Transparency

The Problem: With the removal of commission offers from MLS listings, agents are facing a new reality—one where the tools they’ve relied on for decades are no longer available. This change is intended to reduce potential conflicts of interest, such as steering buyers toward high-commission listings. However, it introduces a significant challenge for buyer’s agents who now must navigate their business without a clear understanding of where commissions stand. It’s a tough spot: while we must avoid conflicts of interest, it’s also unfair to ask agents to build their businesses blindly, unable to budget their time or forecast their earnings.

The Opportunity: Imagine a commission transparency portal—a platform where agents can freely post the commissions they’re offering on listings, away from the MLS. This portal would become the go-to resource for buyer’s agents, allowing them to access this critical data and manage their workload efficiently. Such a platform would empower agents to continue their work with a sense of certainty and control, reducing the guesswork and making it easier to forecast their earnings.

How It Solves the Problem: This portal addresses the longstanding tension between transparency and efficiency. It gives agents the tools they need to run their businesses effectively, without compromising the integrity of their service to clients.

Plot twist: By offering this commission data via API, the portal could become an indispensable tool not just for individual agents, but for the broader real estate community, turning the chaos of the new rules into a structured, accessible system.

2. Content Management System for Agents

The Problem: Agents have long murmured about their lack of control over their intellectual property (IP). And yes, it is IP! The images composed to exacting details and the cleverly written descriptions are the product of their creativity and hard earned know-how from time in market.

Agents generate this valuable data but often feel that control lies with the MLS. This has created a sense of frustration among agents who feel they’re doing the heavy lifting, only to see their data co-opted by these big faceless boards. Those entities get to decide how agents’ IP is used and by whom. The NAR settlement, by shifting more responsibility onto agents, may just be the spark needed to ignite the development of tools that give agents the control they’ve always wanted.

The Opportunity: The time is ripe for a content management system for the modern content creator agent. This system would empower agents to take control of their IP. By perhaps leveraging blockchain technology, every piece of data could be logged and verified, ensuring that agents maintain ownership and control over their work. This system would not only secure their data but also allow them to monetize their content turning access on and off for each node at the end of any distribution pipe–all without the MLS.

How It Solves the Problem: This CMS would address the deep-seated frustrations agents have felt for years. By giving them the tools to manage and protect their data, the CMS puts power back into the hands of the professionals who generate the listings. No longer would agents be at the mercy of centralized systems; instead, they would have the freedom to distribute their listings as they see fit, directly benefiting from the value they create.

3. BYOB: Be Your Own Buyer’s Agent

The Problem: Now that buyers are forced to confront the cost of paying an agent directly, there’s a growing interest among buyers to take control of the home-buying process themselves, to save on commissions. However, navigating this process independently can be daunting, as it involves coordinating inspections, appraisals, and various other tasks typically handled by a buyer’s agent.

The Opportunity: There’s a clear gap in the market for a DIY platform that guides buyers through the home-buying process without the need for a buyer’s agent. And the NAR settlement could initiate a shift that is the buy side equivalent of the FSBO wave that began in the 90’s. A "Be Your Own Buyer’s Agent" (BYOB) platform could provide a comprehensive checklist of tasks, timelines and alerts for when to complete them, and a directory of trusted vendors, and tools to manage the closing process.

How It Solves the Problem: The BYOB platform simplifies the complex home-buying process, breaking it down into manageable steps. Nudged along by an AI co-pilot, it can provide buyers a clear roadmap, along with access to trusted vendors and tools for scheduling and organization, the platform ensures that they can handle the process independently without missing critical steps.

The Secret Sauce: Data

Each of these ideas is more than just a concept—they’re blueprints for the next wave of proptech innovation. However, to bring these ideas to life, software developers will need access to the right data. This is where RealEstateAPI.com comes in. Our APIs offer over 200 data elements, encompassing both physical and financial details, providing the foundational tools developers need to build out these revolutionary products.

Realtime MLS Data: Our MLS Detail API offers real-time data on listings, including essential details like property characteristics, photos, and market information. This data is crucial for a commission transparency portal, enabling agents to access up-to-date information and make informed decisions about how to organize and schedule their work.

Comprehensive Property Details: Our Property Detail API delivers in-depth information about properties, including physical attributes, tax histories, and ownership details. This data is invaluable for platforms like BYOB, where buyers need to understand every aspect of a property before making a purchase. For example, based on the age and location of a house, it might behoove a buyer to order a sweep for oil tanks, not something that automatically springs to the mind of a new homebuyer. Our property data can help flag items like this for an unsuspecting buyer programmatically.

Lien and Encumbrance Data: Our APIs provide critical information about liens and encumbrances, allowing developers to integrate features that give buyers early insights into potential title issues. This is particularly important for DIY platforms, where users need to be fully informed about any potential legal complications. Highlighting liens and encumbrances could offer the DIY buyer a glimpse at potential title clouds before they order a full title report–and maybe persuade them that the situation is just complicated enough that an agent’s wise counsel is needed after all.

Conclusion: Seizing the Opportunities Ahead

The NAR settlement marks the beginning of a new chapter in the real estate industry—one where innovation and data-driven solutions will play a pivotal role. By recognizing the opportunities presented by these regulatory changes and leveraging the robust data provided by RealEstateAPI.com, developers can create powerful tools that meet the evolving needs of real estate professionals and consumers alike.

Whether it’s a portal for commission transparency, a blockchain-backed CMS, or a DIY buyer’s agent platform, the key to success lies in building on a foundation of accurate, real-time data. As the industry adapts to this new reality, those who embrace these opportunities will be well-positioned to lead the way in a post-NAR settlement world.