Privacy and The Real Estate Process

"People who use web-based email today cannot be surprised if their emails are processed by the recipient's [e-mail provider] in the course of delivery. Indeed, 'a person has no legitimate expectation of privacy in information he voluntarily turns over to third parties.' "- Google lawyers in a June 2013 court filing

Privacy: "the right to be let alone" Louis Brandeis, citing Judge Thomas Cooley, described in an 1890 paper (cowritten with Samuel D. Warren).

The real estate process includes numerous privacy oriented policies, from MLS and Association agreements to disclosure documents, franchise fees, rebates and agent compensation practices. Consider three examples that illuminate the growing concerns in and around personal and professional privacy.

1. MLS agreements that assert control and require brokers to cede ownership over broker created listing data. Certain multiple listing service agreements assert ownership over broker created listing data. This means the data brokers enter into an MLS system may be "owned" by the MLS. Conflicts have arisen when the MLS transmits broker created data (sometimes with and without compensation) to third parties that may offer conflicting services with the originating broker, such as national aggregators.

What you can do: Brokers should be pro-active in formulating MLS terms and conditions that support their business model(s).

2. Agent emails transaction information to a buyer, seller or co-broker. One or more of the parties may be using an email provider that "data mines" messages. What might the email provider learn from such communication?

• Metadata. Perhaps one or more of the parties has previously used (via user credentials or statement delivery) their email address with a credit card, bank, insurance or other transactional account. The financial institution can then "tie" the email address to a physical home address, income, age and family data. The email provider may sell the user intent information to third parties, including financial institutions. The email information can be "combined" with financial data along with a social graph of the user over time, adding to the metadata. Consider the downstream implications when personal information is emailed, from social security numbers to personal financial data.

What you can do: Brokers and agents should consider the sensitivity of any information shared via email. Consider the use of encrypted messaging, share in person, or through "secure" portals only. Learn more via this extensive encryption guide.

• Intent. Date, time and message information can signal intent. For example, a prospective home buyer might send an email message that describes their home buying interests to an agent, family members or associates. "Free" email services often mine and monetize such message content. Users of such free email services may notice advertisements displayed around their inbox based on the content of the messages. In fact, mining "intent" data has created the world's largest advertising engine — Google. Google's keyword advertising service sells the user's search (and Gmail) intent to advertisers.

What you can do: Brokers and agents should consider competitive issues associated with intent data mining and disclosure, particularly from large financial institutions who seek core services business.

3. Distribute content to social networks for marketing purposes. Some brokers and agents wish to place their listings and content on as many sites and services as possible. Once the information is present on those services, the ability of the brokerage and/or agent to manage or potentially delete the data is diminished or non-existent. An unflattering property or agent photo or perhaps a poorly written post may live on forever within the social network or aggregator.

Those interested in further understanding personal and professional privacy in the digital era will find security technologist Bruce Schneier's recent article, Restoring Trust in Government and the Internet, worth reading.

Finally, several years ago I created a Facebook account for test purposes with a fake birth date. Perhaps unsurprisingly, I received several direct mail solicitations congratulating me on that fake birthday.

This article originally appeared on the REAL Trends Blog. Reprinted with permission of REAL Trends Inc. Copyright © 2013