The National Association of Realtors has abandoned its policy of making all listings public and available to all prospective buyers within 24 hours.
Instead, it is now allowing brokers to market their listings privately before posting them to the public, while platforms are pushing back.
Zillow and Redfin, real estate websites, both said giving particular people a head start through privately marketed “pocket” or “off-market” listings before listings go up through MLS or Multiple Listing Service sites, which are available to the public, violates the principles and practices on which their sites are based.
In other words, while NAR may allow and approve private marketing, key platforms will not let brokers promote their listings on their sites if they do so.
“Because we believe that all buyers should be able to see all listings, Redfin.com will not publish any listings that have been publicly marketed before being shared with all real estate websites via the MLS,” Redfin CEO Glenn Kelman said.
Not all sites have weighed in against this new policy, which creates a path toward private listings. CoStar Group CEP Andy Florence, owner of Homes.com, said they will remain neutral and stay out of this real estate row. Some brokerages are touting their own private listing services as crucial for luxury properties.
And real estate companies are launching or pumping up various private listing approaches. Douglas Elliman, for instance, has launched Black Label, its new, exclusive private listings site, saying it can help particularly high-net-worth individuals.
These owners may value “discretion, market testing and exclusivity” and provide a choice as to how a home is marketed without things like price cuts or days on the market necessarily being provided. And Compass has been pumping up various approaches to private listing.
“At Compass we are advocating for homeowners to have control over how their listings are marketed,” said Compass CEO and Founder Robert Reffkin.
In addition to a private listing service, Compass launched its Compass Coming Soons listings searchable only on Compass.com that “protect home sellers” from listing days on market and price drops.
“Agents can stay ahead of the market, and homeowners can generate early demand without negative insights,” according to Compass.
Compass said its Coming Soons “can generate early demand without negative insights.” In addition, Compass also is marketing its Compass Private Exclusives as similar to what other industries do to “test products with a smaller audience before launch.
The company said listing your home as a Compass Private Exclusive “allows you to test price, gain critical insights, generate early demand, and extend your marketing runway – all before going public.”
Compass said that its Private Exclusives are only accessible to Compass agents and their serious buyers. “This means you can get a head start marketing your home,” according to the company, “without accumulating any public days on market or price drops that could negatively impact its value.”
Compass said NAR and local MLS mandates prevent Compass agents from sharing private exclusives with non-Compass agents. But the company said its private listings are performing well.
“Early findings are an encouraging signal that giving homeowners more choices on how they market their property and list on the MLS is strongly correlated with better outcomes,” Compass Chief Data Officer Dave Crosby said.
Compass said you can “fine-tune your positioning for the best possible sale outcome” by starting with a soft launch to an exclusive audience. You can list without worrying that you could end up with “damaging public price drops.”
“Know how buyers are engaging with your listing,” according to Compass. “These insights, available only before your home goes live on other sites, help you make adjustments to your pricing.”
Compass said listings pre-marketed as Compass Private Exclusives or Compass Coming Soon before going active on the MLS, had “better outcomes for homeowners.”
NAR has not entirely redrawn the rules of the game, although it has created a path to private marketing, leaving in place some restritions.
The Clear Cooperation Policy, which prevents pocket listings, was developed by NAR’s Multiple Listing Policy Committee, approved by its board of directors in November 2019, and implemented as of May 1, 2020.
“Our goal is and always has been to foster an efficient, fair and transparent real estate market for consumers,” NAR said in a written statement, “and to help brokers and agents carry out their ethical duty to put their clients’ interests first.”
The new policy, part of NAR’s Handbook on Multiple Listing Policy, was developed after consulting with MLS and association leaders, brokerages, agents, multicultural organizations, fair housing, policy, technology, and legal experts.
While most listings will likely continue to go to MLS as rapidly as ever, the new policy lets brokers create a category called “delayed marketing exempt listings.” That amounts to a game changer, even if it doesn’t completely change all the rules.
The association’s “Clear Cooperation” rules have long required homes to be listed on multiple listing services within a day of “public” marketing. That’s still the case, but there’s a catch.
It also gave brokers the blessing when it comes to delaying advertising of homes online while they market privately. “Delayed marketing exempt listings” would still be filed with MLS and be available to other MLS participants and subscribers to promote to clients. But they wouldn’t be able to show or syndicate the listings as they do now.
Displaying the listings through an Internet Data Exchange, also known as IDX, feed, which lets agents and brokers display listings from Multiple Listing Services on their websites, would be delayed.
Supporters of “Clear Cooperation” say this assures sellers will reach a wide swathe of potential buyers and gives buyers an even playing field, which can boost demand and prices.
Still, some critics of “Clear Cooperation” have said this transparency can create a stigma, if a house is online for a long time or if prices are cut, things that wouldn’t be public through a more private process.
Owners of particularly pricey homes may prefer privacy and private marketing over reaching out to a wide range of people who can’t afford the house.
Kelman said Redfin is asking MLS sites to create a “coming soon” designation for listings, which would prevent search sites from showing how long a home has been for sale and at what prices.
He said some brokers favor “coming-soon” listings with access limited to agents, and potentially only to their own agents. Kelman opposes that modification, while referring to “the last great real estate anti-trust battle, settled in 2008.”
That, he said, concluded with the idea that “all brokerage customers should be able to see all MLS listings, online or via an agent.”
Kelman said there are good reasons to preserve access to the public rather than a privilege that favors certain buyers. “That principle exists for a reason,” Kelman said of the public preference. “Once brokers give our clients control over how their listing appears online, every client will want that listing to appear everywhere.”
