Bruce Theobald, a real estate broker with LakeFront Realty Group in Chicago, is keeping a close eye on developments in his local market: two major brokers have pulled a number of for-sale listings out of Multiple Listing Service of Northern Illinois, the region’s major MLS. If others follow suit, their decisions could have serious implications for brokers throughout the region, he said.

 

Koenig & Strey GMAC, which has 13 offices and 700 sales agents in the Chicago area, pulled the listings from its Northshore offices out of MLSNI in favor of MAP, a smaller, broker-owned MLS. The pullout came nearly two months after 10 large Coldwell Banker Residential Brokerage offices removed their listings from MLSNI.

 

“We have a fine mess here in Chicago,” Theobald said. “If everyone migrates to MAP, MLSNI could cease to exist.”

 

Brokers in the region now must decide whether to join MAP as well as MLSNI, despite the additional cost of belonging to the smaller MLSs as well as the much larger one. Having two MLSs in one area means agents have to search both databases to find homes for buyers and research data from both database to create comparative market analyses. Broker cooperation is at the heart what makes the entire MLS system a success.

 

“The MLS is like air for realty agents,” Theobald said.

 

MLSNI is a Realtor association-owned organization that has 37,000 members in 6,000 realty offices in the Chicago area. The MLS has been in the spotlight not only due to the shifting loyalties, but also because its shareholders last month ordered a forensic audit of the operation and its CEO Jay Huffman.

 

Theobald hasn’t switched from MLSNI to MAP, but he has the MAP membership application in his office. If more of the region’s largest brokers pulled their listings from MLSNI in favor of MAP, he’d have to join MAP also to offer proper exposure for his clients’ listings.

Theobald is also worried about the implications of the situation for the Realtor associations that own MLSNI because brokers must join the association before they can join the MLS. If brokers decided not to join the associations because they no longer wanted to belong to MLSNI, those associations could see a decrease in membership dues.

No one from Koenig & Strey’s headquarters returned a telephone call seeking comment.

 

Chicago-area brokers also have speculated that Baird & Warner might pull some of its listings out of MLSNI as well.

 

Steve Baird, president of Baird & Warner, didn’t confirm any such plans, but he said the company is “seriously considering” its options.

 

Baird & Warner currently places its listings from the Northshore market and about half of its 31 offices throughout the Chicago area in both MLSNI and MAP, according to Baird.

 

“I’m very supportive of what Coldwell Banker and Koenig & Strey are doing,” he said.

 

The Coldwell Banker offices’ move from MLSNI to MAP in March sparked an increase in memberships at MAP, a non-profit organization that’s been in the Chicago market for 48 years, MAP CEO Bud Fogel said at the time. The MLS, which has about 12,000 subscribers, received about 150 applications from brokers and 800 from agents in the first few weeks after Coldwell made its Northshore listings exclusive with MAP.

 

“There’s no question that’s what spurred all that membership activity,” Fogel said.

 

The Chicago Association of Realtors informed its members of both brokerages’ decisions to pull their listings because the unilateral broker compensation agreement that exists among brokers within MLSNI doesn’t apply to deals outside the MLS. Brokers who do business with MAP-only offices, but don’t belong to MAP need to draft separate agreements.

 

Send tips or feedback to Jessica@inman.com; (510) 658-9252, ext.133.

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
Success!
Thank you for subscribing to Morning Headlines.
Back to top