What is Broker Reciprocity?
Broker Reciprocity is the principle of cooperation that backs all Internet Data Exchange (IDX) programs. Under Broker Reciprocity, participating brokers are granted access to the listings of all other participating brokers in exchange for granting access to their own.
How Does Broker Reciprocity Work?
Broker Reciprocity works as a common pool of listings formed from the individual listings of participating brokers. Any new broker that decides to participate, provides her listings to the pool. Which grants the broker access to the pool itself. The broker may then market the entire pool as if it were her own and receive compensation for any listings that she helps sell.
What Is the Difference Between Broker Reciprocity and IDX?
IDX is the set of rules, licenses, and technologies that allow real estate agents to access MLS listings, integrate them on their websites, and display them publicly.
Broker Reciprocity is the principle of cooperation on which those rules, licenses, and technologies are founded.
Some MLS call their IDX program Broker Reciprocity, in which case they are the same thing.
Broker Reciprocity can help a broker get more exposure for her listings by letting others republish them.
Broker Reciprocity also can help a broker draw more traffic to her website by allowing her to republish others’ listings.
Why Does Broker Reciprocity Exist?
Broker Reciprocity exists because the real estate industry is decentralized.
In the early days of the real estate industry, brokers were responsible for their own businesses. They created their own listings and only marketed them to their own clients. There was very little cooperation.
This presented several problems. First, large brokerages had a huge advantage in the market because they had the most listings. Second, there were redundancies in services offered by each brokerage that made the industry inefficient.
Since the late 1800’s brokers have sought ways to cooperate for the benefit of all. First they created the Multiple Listing Service, which allowed brokers to view more listings and better match potential homebuyers with available properties.
Then in the 1990’s with the emergence of the Internet, they created IDX. This allowed brokers to publish online and expand their marketing reach.
Broker Reciprocity created a situation in which all brokers win and helped limit the challenges of decentralization.