Open Architecture: What it Really Means to the Real Estate Industry

Published Aug 01, 2017

open architecture-1Bob Bemis, Vice President of Business Development, Realtors Property Resource®

A real world analogy

Imagine doing something simple like checking the weather on your smartphone because you want to know if it’s safe to schedule a tee time or plan tomorrow’s picnic. Knowing the predicted temperatures isn’t enough, you want details — an hour-by-hour forecast that predicts the chance of rain, temperature ranges, humidity, and winds. For that you would probably fire up the Weather Channel app, which uses an application programming interface (API), to display every imaginable data point needed to make an informed decision about tomorrow’s plans.


But you’re not limited to just the Weather Channel. Depending on preference, apps like Accuweather, Weatherbug, and Dark Sky all offer what you want. Each does different things and appeals to different users, but they all operate using an API.


Simply, APIs open the internal architecture of a service to others, and the result is often a service of much greater value than the sum of the parts. The most popular data sources accessible through a published API include household names such as Facebook, Google Maps, Twitter, YouTube, LinkedIn, Flickr, and Pinterest.


Open architecture in the real estate realm works the same way. Or it should.


No matter the task or desired tools, an open system — a standardized database with available API connectors — allows any authorized application to connect through an API to retrieve requested data, sometimes from multiple sources, to do the work agents and brokers want to do, like listing agents who may only need CMA and market research tools or buyer agents who may only need property search and tour info.


In an open system, agents are not limited to the “one size fits all” default interface offered by the one MLS-chosen vendor. API based systems allow agents to pick Cloud CMA for their listing presentations, Boomtown for their CRM and lead management needs, and TLCEngine for qualifying buyers, all without giving up their live connection to the real-time MLS database.


Such a system would require MLSs to consider a new business model in offering services — one where multiple application vendors compete on the utility and value their applications offer, not just on price. This approach opens the door for a multitude of options the MLS may offer agents and brokers, and through those options, empower subscribers to select only those that enhance their ability to do more business with greater efficiency.


Yet, the MLS industry of today runs on a small collection of proprietary database systems that are closed to access by any outside software. If a developer wants to sell a software program that uses MLS data, it must acquire a data license and then download the data to a locally hosted database. They cannot access the MLS database directly. To complicate matters, each proprietary MLS database is different, requiring the developer to map the data from each MLS into a common format so the app program can read it.


Data and access standards through an API change that relationship. When adopted by the real estate industry, each MLS database that uses that API can be queried by the new applications directly, without downloading and synchronizing multiple databases. Developers can build the app once and deploy it in hundreds of systems reaching millions of agents. Doing so opens the door to large numbers of new developers who realize increased opportunities for expansion. Their participation will stimulate innovation and bring products to market that would never have been possible before.


For Brokers and Agents, that means a whole new world of options, primarily more choices and greater flexibility.

For Brokers

  • Flexibility and control, key characteristics of an API-based system, allow MLSs to be more responsive to a Broker’s business needs.
  • Brokers can maintain control over applications their agents use.
  • More opportunities to promote tools to agents that allow them to reduce costs through the unbundling of “MLS core services.”
  • Receive a single data feed from multiple participating MLSs in a standardized format.


For Agents

  • Choose from a gallery of applications, not previously available through traditional MLS systems.
  • Mix and match tools from different vendors to suit needs, business plans and work styles.
  • Data stays in sync as you work across multiple applications.
  • Entering and updating listings is easier and more streamlined.


Open architecture as a disruptive business model

There is a great deal of discourse in the real estate industry about open architecture. Yet, it boils down to perspective. Traditional vendors of these closed database solutions recognize they are vulnerable to disruption by this new approach. Some embrace the concept by extending existing systems with a read-only version of an API-accessible database. CoreLogic, the largest legacy vendor, has introduced Trestle™. Not to be outdone, Zillow (while not an MLS vendor, certainly a major database player) has offered the Retsly® service that aggregates MLS data and makes it available through an API.


Realtors Property Resource® (RPR®) is developing the Advanced MultiList Platform™ (AMP™). In essence, AMP reimagines the architecture of the modern MLS by providing technology that opens the MLS database to API access for both input and retrieval of property data, thereby expanding the type, quantity, and quality of tools and applications that can be offered by both large and small MLSs to their subscribers.


Through AMP’s open architecture:

  1. Subscribers choose either a small set of individual applications, a full-featured traditional MLS system, or both
  2. Application developers bring dozens of new products and services to subscribers
  3. The MLS maintains control over its data and application offerings. This approach eliminates the need for a parallel output server, like Trestle or Spark, and eliminates any latency or lag inherent in updating the output database with live MLS data.


If you are an independent developer, however, your opportunities border on euphoria. Hundreds of possible markets will soon be open to you and your team, where previously totally inaccessible.


Scores of MLSs and real estate associations across the nation are voicing their support of the AMP project, including Walt Baczkowski, CEO of the San Francisco Association of REALTORS®.


“AMP has the potential to be a total game changer. By opening up the MLS database to innovative developers, AMP allows us to offer a vast array of new tools to our agents—tools that would never have had a chance to come to market without the novel architecture that RPR is building.”


Real estate is not alone

Real estate is not alone in trying to find ways to better manage and expose data. Most are finding the API approach to be part of the solution.


Casting aside current perceptions of the airline industry, 20 years ago they took the lead by developing an API for accessing flight reservation data. The airlines did this so they could view current inventories in real time and sell tickets across multiple carriers. As a result, we (the consumers) experienced an explosion in online travel services (Travelocity in 1996 followed by Expedia, Kayak, and others), which have all greatly benefited the American consumer.


The real estate API approach is going to have similar impact. But unlike travel agents, who were nearly driven to extinction by online services, real estate agents will thrive in this API environment. They will be equipped with an array of new tools that will let them serve consumers better, faster, and with more professionalism than ever before.


Other excellent API examples include:

  • Google opened the world to maps of all kinds when they published its mapping API, the second most widely used API on the Web.
  • In the financial world, electronic transactions have become the norm thanks to major API innovations from PayPal, Stripe, Square and others.
  • In banking, you can transfer funds or deposit checks directly from your phone using APIs.
  • eTrade’s API allows us to trade stocks from anywhere, at anytime using any number of independent trading programs.


Open architecture and the future of real estate

API is the buzzword of the year in real estate. It’s being talked about by many and analyzed by some, but will benefit all when this digital experience is more widely adopted. Here are some articles that will more fully explain the growing interest and potential impact of widespread API adoption.


Helpful reading:

How real estate technology can ‘catch up’ with open APIs

Real estate tools could be faster (and cheaper) — here’s how

Open developer APIs essentially do not exist in the mortgage industry — that’s a problem