Why would anyone replace a stable MLS system?
Why would anyone want to replace a perfectly good MLS system? The Paragon system is liked by many and it was very stable. TMLS launched Paragon back in October 2014, almost 10 years ago, and it has not significantly changed since then. When any system remains unchanged for so long Subscribers come to rely on the constancy of that experience. A familiar series of clicks on specific points consistently produces the needed report quickly and reliably. But when there is a system update and those points are moved around, or reports are produced in a different way, there is understandable disruption. So, why would anyone want to mess with that?
A Look Back for Context
There are of course several compelling reasons, or the Board of Directors would never have attempted the project. This post is intended to explain this project to the Subscribers and to the MLS industry at large since many have asked for more information about our project. I wrote about this a few months ago so this is sort of an update. So, the idea of replacing Paragon was considered by the Board just before the previous MLS Executive Director resigned. Back then the Board saw demonstrations from all the major vendors and selected FBS’s Flexmls system. The former Director resigned during the final negotiations so the Board decided to execute a short-term extension with Black Knight, the makers of the Paragon system. The Board did not feel prepared to replace Paragon without the leadership in place so FBS was shelved.
In December 2021 the organization decided to split the leadership position that sits at the top of both the RRAR and TMLS organizations. Before then the RRAR CEO also acted as the TMLS Executive Director but in late 2021 the organization shifted gears. Dave Phillips, a long-time Executive at State and Local Association affiliates of the National Association of Realtors was hired to manage RRAR, and Matt Fowler (me) was hired to manage TMLS as its first independent Executive Director. I ran an MLS software company for twenty years before I sold it to FBS, the same FBS the Board picked in 2020. Like Dave came into RRAR with ideas of how an Association should be managed, I have been thinking about the optimal way to manage an MLSs for about a long time. At one point my old company had about fifty of them as customers so I have seen well-run MLSs and not-so-well-run MLSs. The outcomes for Subscribers can vary from place to place if the MLS is not run by someone who understands system architecture. The analogy is a good one. You have seen houses designed by the builders, and houses designed by architects, there is a huge difference. The design we decided to use for TMLS acknowledges the Board’s interest in Flexmls, but also realizes that most users would rather not switch from Paragon.
At the same time, in early 2022, we were approached by Alamance MLS interested in a merger. TMLS had not added a new Association to the Regional in more than a decade so this was a big deal. They were on the fence, deciding between TMLS and TriadMLS to the West. They had slightly more overlap with TMLS but TriadMLS users have CoreLogic’s Matrix system and did not want to change to Paragon. Switching platforms was a real barrier to the proposed merger.
Looking at the needs of the growing region, a design began to form, but it was far from new. This report from Bob Bemis, now MLS Executive in Park City Utah but written when he worked for NAR features an illustration that helps visualize the concept:
The diagram is not a one-to-one representation of our project but it’s close. The central point is the separation of the “Front End” from the “Back End”. I know that some people reading this are Realtors and not engineers so we will not get in the weeds. This is the critical part to understand however: making the data match the national standards allows software built to those standards to easily drop into any MLS system.
Metaphorically, instead of a table of wires, we built a set of data plugs. If you have a plug that fits, you are in business. If not, you will, metaphorically, need an electrician. In real estate tech, that means that the new data systems at the MLS, the new Back End, allow essentially any technology to work that follows the standards. The design in Bemis’s diagram is from 2015. I was a tech CEO back then and remember thinking this was a smart way to deploy MLS technology. Even though it meant that the MLS vendors would lose their exclusivity we were attracted to the design and promoted it to our customers and potential customers. As a small company, it meant we could get access to big markets where we would compete against the big software giants for business.
In 2021, six years later, I realized that this was the obvious design choice for the architecture of the new system at the MLS. Looking around we found a few other MLSs already doing this, most notably my old friend John Mosey’s system in Minneapolis, the NorthStarMLS. They offer the same three Front Ends that we offer. The Triangle project was profiled in this White Paper last month if you want to deep dive into the technical work.
Choice Comes in for a Landing
On the ground in early 2022 it appeared that the new design would check several boxes. If we had a standardized dataset, we could hypothetically offer the Flexmls software the Board liked in 2020, and also allow Alamance to stay on Matrix, and at the same time allow the majority the option of staying on Paragon if they wanted. So, that is what the Board decided to do. The architecture required three new contracts, new technical employees to manage the integrations, and a new focus on Communication to keep the community up to date.
First. the MLS signed a contract with FBS for their SparkPlatform Application Programming Interface (API), the deepest and most extensive MLS Back End in the business.
Ask anyone, nothing compares to SparkPlatform. That contract included a large block of work to translate 1.7 million historical records into National Standard terms using the Real Estate Standards Organization (reso.org) current Data Dictionary. The Contract also specified the delivery of the new TMLS Listing Management System to collect and manage listings using the new standard terms. And also included an option for Subscribers to use Flexmls in addition to, or instead of Paragon. This work was substantially delivered on time and on budget on November 27, 2023. The new date was made available to the other vendors for testing and system configuration in July 2023, five months before the launch of the Choice project.
Next, the MLS signed an extension to the Black Knight/Paragon contract, now called ICE Mortgage Technology after being purchased by Intercontinental Exchange, Inc., the owners of the New York Stock Exchange. The ICE agreement maintained Subscriber’s access to Paragon by requiring them to import the listing data from SparkPlatform instead of getting it through the Inventory/Maintenance interface in Paragon. ICE leadership understood the scope of the project and committed to a September release. The plan was to translate the new standardized terms and conditions back into the old format for the old Paragon systems. This was done for two reasons: ICE could not commit to getting the work done sooner, and everyone felt it would mean even fewer changes for Paragon users, something the Team felt was a desirable objective. ICE pushed the September date to October and then again into late October before pushing one more time to November 29th. If ICE missed the November 29th deadline the MLS was prepared to cancel the agreement and move all users to Flexmls or Matrix.
ICE did meet the deadline but data mapping from the new data back into Paragon was not done well. If there are 800 fields in the database, they may have gotten 700 correct, which seems like a high percentage but it was not. The Paragon and Matrix systems were both severely disrupted in December and into 2024. Most issues were resolved by February and March but it was a terrible experience overall for everyone involved.
In late August 2024, we released a new version of Paragon and Paragon Connect built on the new dataset. The latency between systems is down to under five minutes and mismatched terms are substantially resolved. Documents are present and easier to share so Paragon in general appears to be returning to a stable, trusted operating environment. With all of the issues, 73% of MLS users decided to stay with Paragon. That was made possible by the work on standards.
Next, the MLS signed an agreement with CoreLogic to offer the Matrix system to MLS Subscribers. This allowed all of the former Alamance MLS members to opt-in to Matrix staying with a trusted platform while still completing a needed merger. The ability for the MLS to offer Matrix facilitated the merger by reducing the friction around the MLS software platform. The Board expects other CoreLogic MLSs to look at us because of this. Matrix is currently reengineering the data connections to the MLS and expects to release a new updated Matrix in the next few months. That will bring all three MLS options up to the same level of data currency and coherence to the Standards.
Finally, in early September 2024, we are approaching a year after launch. While there were many problems, the Board, the Team, and Industry see the project as a success. It is already apparent that the arrangement has introduced much-needed competition between the vendors. Plus, Subscribers to the MLS no longer have to wait for a single vendor to bring in a new feature. If you use Paragon and Matrix comes out with some new feature you’ve always wanted, you can change it the same day. If a Broker or Agent finds software they think will animate their businesses, they can probably plug it into the MLS without undertaking an expensive development project. They might even find that new software on the MLS Dashboard. MLS plans to curate applications that offer new or alternative ways to do MLS alongside the traditional MLS Front End software. Those options will start showing up on the Dashboard in Q4 and Q1 2025.
This marketplace for software and services is materially different from the old “one vendor for all Subscribers that does all things” way. The new way is more expensive across the board and is vastly more complicated. But even with those drawbacks, the resilience, competition, and innovation make it overwhelmingly worthwhile.
