Would you like to generate interest for your home before listing it by having your agent advertise that your house is “coming soon?” Would you like to test the waters of the current market for an as is sell with a group of investors before sinking thousands of dollars into renovation and repairs? What about marketing your home to a limited network because of safety or privacy concerns? Well, thanks to a new policy instituted by the National Association of Realtors, you may have to a) work with a licensed agent or attorney who is not a Realtor or member of the MLS (multiple listing service), or b) do it yourself.
Not satisfied with being involved with two class action lawsuits over homeowners being forced to compensate buyer’s agents as a condition for putting their home on the MLS, the National Association of Realtors has decided to invite more scrutiny by adopting an all or nothing policy that tells homeowners preserving the MLS is more important than their preferences when it comes to selling what is often a homeowner’s most valuable asset.
The National Association of Realtors would like you to believe their intentions are noble, that this is all about fairness and consumer good, and they have somehow suddenly seen the light about practices that have been going on for decades. But experience tells us that there is usually a money trail leading to these kind of sudden epiphanies. Enter a high profile real estate company named Compass - with SoftBank money - throwing around terms like “twenty percent market share” and “national MLS” - combine that with Compass adding “Coming Soon” listings to their own site before they hit the MLS and encouraging agents and consumers to look there first, and you have quite an innovator hitting the real estate market.
Not to be outdone, other large, competing brokerages started doing the same thing.
All of a sudden, coming soon and pocket listings become such an ethical crisis, NAR has to pass a hasty rule that’s riddled with loopholes and backs consumers into an all or nothing corner when dealing with an agent who is also a Realtor. A critical look at the rule reveals this has nothing to do with fairness and everything to do with maintaining control of the lucrative, but hopelessly dysfunctional and outdated MLS and preserving the status quo. NAR has refused to innovate at every critical juncture and they expect consumers to keep paying for a bloated and inefficient system as if there aren’t any other options available now and won’t be any available in the very near future.
If you are inclined to entrepreneurship and innovation, this is a good time to ask “what’s next?” Any non-government system that has to start passing rules and laws to preserve itself, is probably not going to be around for the long haul. I’ve already gotten two calls from people asking for input on building an alternative system and just yesterday I received a marketing email from a new company that would market my “coming soon” listings for me since I, as a realtor, am no longer allowed to do that.
If you are a homeowner who is thinking about selling your home over the next few years, the question becomes “is there really only one way to do this?” In many cases the traditional system of using an agent to list your house on the MLS and having part of the commission you pay go to a buyers agent to bring in a qualified buyer and help get the transaction to close is still the best option. But as the current system stagnates and limits choice, while innovators come in willing to give consumers a better deal and more options, this may not always be the case.