Incentives and the Near Future of the Real Estate Industry

Predicting the near future of the industry, by examining the incentives at play

Last week, I participated in a panel discussion with two good friends with whom I disagree frequently: Ed Zorn, General Counsel of CRMLS, and James Dwiggins, CEO of Nexthome and Rayse. It was a panel on MLS issues for the Orange County Association of REALTORS, who did a fantastic job of putting on the event.

During that panel, I came to a realization. I am quite a bit more fatalistic about the future of the industry than even I had thought. By the way, fatalism does not mean “you’re all gonna die.” The root word is not “fatal” but “fate.” One dictionary definition is “the belief that all events are predetermined and therefore inevitable.”

Well, I don’t know about all events, but as it comes to the future of the MLS and the industry, I do think the near future is predetermined and therefore inevitable no matter what NAR, the MLS, Zillow, Dwiggins, and others do to try and prevent it.

Why? I was realizing this as I was saying it on stage. To quote Charlie Munger, show me the incentives, and I’ll show you the outcome.

This entire line of thinking was immensely helped when I happened upon a couple of blogposts of mine from 2013. That’s right, pieces I wrote a dozen years ago have sharpened the incentives at play, and helped me understand what is coming our way.

Let’s get into it.