The FCC’s New Rules on Lead Aggregators & Real Estate
Feb 7, 2024
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The podcast discusses the FCC's new rules on lead aggregators and their impact on real estate professionals. The speakers delve into topics such as obtaining consumer consent, exceptions to automated messages, the potential penalties for lead generators. They also touch on the challenges posed by foreign entities, the importance of understanding and diversifying lead sources, and the discussions surrounding commission laws and spam.
Lead aggregators in the real estate industry will now be required to obtain consent from consumers before obtaining their personal information.
The new FCC rules could lead to higher lead costs and a decrease in lead volumes, impacting the existing business models of lead aggregators.
Deep dives
The FCC rules on lead aggregators and real estate
The FCC has passed new rules regarding lead aggregators and their practices in the real estate industry. The rules aim to crack down on spam telephone calls and ensure that leads have context and consent. Sellers of leads will now have to ensure that they only sell leads related to the specific products or services advertised and must gain one-to-one explicit consent from consumers for each business entity they sell the lead to. The rules primarily target automated robocalls and texts, and there is no prohibition on human agents manually calling leads. The penalties for non-compliance are expected to be severe, with potential fines and lawsuits. The impact of the rules on the residential real estate sector is expected to be significant, with lead volumes likely to decrease and lead costs likely to rise. Brokers and agents are advised to understand their dependence on buying leads, clarify the consent and flows of leads they purchase, and diversify their lead generation strategies.
Potential impact on portals and lead generation
The new FCC rules are expected to impact portals and lead aggregators in the real estate industry. Lead aggregators will no longer be able to sell leads to multiple businesses across various industries, and the consent for each lead will need to be obtained one-to-one. This change is likely to impact the existing business models of lead aggregators who heavily rely on selling the same leads to multiple businesses. The new rules could lead to higher lead costs and a decrease in lead volumes. However, companies in the industry have been aware of the changing landscape and are likely working on strategies to adapt to the new rules.
Concerns about the impact on small businesses
One of the dissenting opinions in the FCC ruling expressed concerns about the potential impact on small businesses, specifically in the real estate and mortgage industries. The dissenting commissioner felt that the rules could disproportionately impact these businesses. The concern is that the decreased lead volumes and increased lead costs could have a significant effect on small brokers and agents who heavily rely on buying leads from third-party aggregators. To mitigate this, brokers and agents are advised to understand their exposure to buying leads, clarify lead flows and consent processes, and diversify their lead sources to reduce dependence on third-party aggregators.
Additional considerations
There is no indication in the FCC rules about compensating consumers for opting in to receive leads. While this approach could potentially be explored, there are concerns about potential fraud and abuse. Consumer compensation could incentivize individuals to provide false information or sign up for leads they have no genuine interest in. Additionally, the impact of the rules on international companies and compliance with foreign regulations is unclear. Overall, brokers and agents need to stay informed about the evolving regulations, evaluate their lead generation strategies, and work towards building diverse and sustainable lead sources.
How will the FCC’s new rules on lead aggregators affect real estate professionals? On this episode of Industry Relations, Rob and Greg talk to Matthew Marx of Evocalize about how to stay compliant while still effectively marketing themselves. One of the biggest changes is that lead aggregators will now be required to obtain consent from consumers before obtaining their personal information. So what do real estate professionals who use lead aggregators need to do? Tune in to find out!
