MLS & Associations

Dual agency not as popular as you think

MLS data sheds new light on brokers and agents working both sides of the transaction

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New technology has made selling listings off the local multiple listing service easier than ever for agents. From Zillow’s “Coming Soon” listings to private Facebook groups to brokerage apps that encourage in-house deals, the MLS is not the only game in town.

Critics blame greed. They say agents and brokers want to collect both sides of a commission in a real estate transaction, regardless of what’s best for the buyer, the seller or the cooperation that underpins the industry. But has the double-ending of deals actually increased along with pocket listings?

To find out we asked for stats from four multiple listing services across the country representing some 127,000 real estate professionals: Rockville, Maryland-based Metropolitan Regional Information Systems Inc. (MRIS); Lisle, Illinois-based Midwest Real Estate Data LLC (MRED); the Houston Association of Realtors (HAR); and Silicon Valley-based MLSListings Inc.

In general, the data indicate that the share of deals that are double-ended, whether by the agent and broker or just the broker, has either declined or roughly plateaued in the years following the housing bust.

The share of double-ended deals varied by MLS: In 2013, 24 percent of MLSListings’ sold listings had the same broker on both sides; 11 percent were same-agent deals. For HAR, those numbers were 15 percent and 8.4 percent, respectively. Among MRIS’ sold listings in 2013, 15.6 percent were same-office deals and 9.5 percent were same-agent deals. For MRED, those figures were 13.5 percent and 7.3 percent, respectively.

Andrew Strauch, MRIS vice president of product innovation and marketing, believes the decrease in double-ended deals in MRIS’ coverage area from around 20 percent in the early 2000s to around 15 percent in recent years was due to a drop in the velocity of sales after the bottom fell out of the market.

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“The market was crazy from 2002 to 2007. There were lots of sellers that wanted to sell (and) lots of buyers that wanted to buy resulting in more coincidental matches internal to a brokerage office that met the needs of the seller. When things quieted down agents had to look more broadly to find buyers,” Strauch said.

All things being equal, if an agent had an exact same offer from two different buyers, they were more likely to work with the buyer they were familiar with through their own firm, he said. After the bust, they were less likely to be able to find a buyer among their own ranks, he added.

An MRED spokesperson used similar reasoning to explain the decline in double-ended deals, saying that agents have had to work harder to match sellers and buyers, but attributed that challenge to tighter inventory.

“Years ago it was easier for one of an agent’s 10 buyers to buy the house of one of his or her 10 sellers. Now, it’s harder for one of that same agent’s 10 buyers to buy the house of one of his or her three sellers,” the spokesperson said.

“I think it becomes harder to keep a listing within your office because agents just don’t have as many listings. It’s all about the smaller inventory.”

It is worth noting that the opposite argument is often made: that tight inventory means that listing agents can have their pick of buyers and often choose one that will hook them both sides of the commission.

MRED doesn’t track off-MLS deals or “comp only” deals like some other MLSs do, so it is difficult to say what precisely the effect of pocket listings has been on double-ended deals in that market. Even in those that do keep track, it is unclear what the effect of listings kept completely off the MLS would be on this dual agency data.

Data from other MLSs does provide some clues. MRIS listings that sold within one day or the same day, which the MLS typically considers pocket listings, declined from 7.6 percent of transactions in 2005 to 4.3 percent in the first eight months of this year. Strauch considers 4 percent to be the long-term trend for pocket listings in the areas MRIS covers.

“There were definitely fewer listings going in the MLS (during the boom),” Strauch said.

“Comp only” data from both MRIS and MLSListings shows that listings excluded from the MLS but then entered into the MLS after they had been sold were considerably more likely to be doubled-ended by brokers than transactions overall, and were also double-ended by agents more often than not.

While the data hints at the behavior of agents holding listings off the MLS, “comp only” listings are a tiny percentage of overall transactions recorded in the MLS. It could be that the majority of pocket listings are not entered into the MLS even for comp purposes, and whether they were double-ended or not remains lost.

But most listings are still recorded in the MLS, and the rate at which those deals are double-ended is either going down or stabilizing. Another housing boom or a much more significant tech innovation than the current crop of tools could change that.

MLSListings Inc.:

Doubled-ended deals:

Year Number soldlistings SFR/C/T Number Same Agent Both Sides Percent Same Agent Both Sides Same Broker Code Both Sides Percent Same Broker Code Both Sides Same Broker Code Different Agent Percent Same Broker Code Different Agent
2010 29,789 2,772 9% 5,985 20% 3215 11%
2011 30,207 2,626 9% 5,924 20% 3298 11%
2012 32,374 2,991 9% 7,106 22% 4115 13%
2013 30,839 3,304 11% 7,389 24% 4085 13%
2014 YTD 19,492 1,849 9% 4,115 21% 2266 12%

YTD= Through Sep. 4, 2014

Note from MLSListings: For the double-ending info, we matched purely on license number and broker code. We do accommodate teams; however, we did not delve into that analysis for this data pull.

Comp-only double-ended deals:

Comp-Only Total Double-End Comp Only Same Agent Double-End Comp Only Same Agent Double-End (%) Comp Only Same Broker Double End Comp Only Same Broker Double End (%) Comp Only Same Broker Different Agent Double End Comp Only Same Broker Different Agent Double End (%)
2010 146 43 29% 68 47% 25 17%
2011 161 47 29% 85 53% 38 24%
2012 300 92 31% 152 51% 60 20%
2013 377 119 32% 230 61% 111 29%
2014 YTD 261 79 30% 135 52% 56 21%

Note from MLSListings: We do allow agents to enter comp-only deals, but only if the property was properly excluded by having the seller sign our exclusion form and then turning that form in to our compliance team. If the property was not excluded through our exclusion filing process, it is not able to be added to the system as a comp.YTD = Through Sep. 11, 2014

Off-MLS deals:

Year Percent Sold Off-MLS
2012 13.63%
2013 20.69%
2014 (Q1-Q2) 17.07%

Off-MLS deals from Jan. 1-June 30, 2014:

County Number of Sales Number Sold on MLS Number Not Sold on MLS Percent Sold Off-MLS Sales Volume Sold Off-MLS
Monterey 1,547 1,255 292 18.88% $190,234,300
San Benito 282 243 39 13.83% $12,435,437
San Mateo 3,428 2,835 593 17.30% $564,778,581
Santa Clara 8,330 6,903 1,427 17.13% $1,075,529,439
Santa Cruz 1,178 1,008 170 14.43% $78,081,091
ALL 5 Counties 14,765 12,244 2,521 17.07% $1,921,058,848

Midwest Real Estate Data LLC (MRED):

Double-ended deals:

Time Period # Closed Transactions # Doublesided by Agent 0% # Doublesided within Office 0% Avg. MSI
Q2 2014 33,633 2,259 6.70% 4,267 12.70% 3.5
Q1 2014 21,584 1,546 7.20% 2,767 12.80% 4.5
Q1 – Q2 2014 55,217 3,805 6.90% 7,034 12.70% 4
Q1 – Q2 2013 58,381 4,231 7.20% 7,904 13.50% 4.5
Q1 – Q2 2012 46,051 3,824 8.30% 6,905 15.00% 7.7
Q1 – Q2 2011 37,791 3,368 8.90% 6,041 16.00% 11.9
Q1 – Q2 2010 44,365 3,957 8.90% 6,915 15.60% 12.8
Q1 – Q2 2009 32,332 3,188 9.90% 5,363 16.60% 15.5
Q1 – Q4 2013 125,114 9,113 7.30% 16,907 13.50% 4.9
Q1 – Q4 2012 101,239 8,236 8.10% 14,856 14.70% 7.4
Q1 – Q4 2011 80,452 7,087 8.80% 12,762 15.90% 11.9
Q1 – Q4 2010 80,544 7,579 9.40% 13,142 16.30% 14.6
Q1 – Q4 2009 79,637 7,549 9.50% 12,742 16.00% 14.3

Note: “Double-sided within office” does not account for deals that were double-sided by agents in the same brokerage firm but in different offices.MREDDoublesidedChart092914

Months supply of inventory:

MREDAverageMSI092914

Houston Association of Realtors:

Double-ended deals:

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 YTD
% Same Broker Transactions 24.2% 22.0% 20.3% 18.5% 17.4% 16.0% 15.8% 16.4% 16.0% 15.0% 15.1%
Total Transactions 59658 65179 72441 69882 58780 54614 51681 53830 62695 73721 49409
Coop Transaction 14437 14363 14684 12963 10248 8738 8165 8828 10031 11058 7455
Same Agent 9917 9644 9610 8131 6360 5157 4693 4999 5571 6166 4247
% Same Agent Transactions 16.6% 14.8% 13.3% 11.6% 10.8% 9.4% 9.1% 9.3% 8.9% 8.4% 8.6%

HARSameBroker_AgentTransactions2004-2014

Metropolitan Regional Information Systems Inc. (MRIS):

Residential Sales

Year Total Transactions* Units Sold Units Sold Same Office % of Total Units Sold Units Sold Same Agent % of Total Units Sold
2014 YTD** 157,248 78,624 11,977 15.20% 7,561 9.60%
2013 240,196 120,098 18,748 15.60% 11,420 9.50%
2012 200,422 100,211 15,101 15.10% 8,616 8.60%
2011 201,802 100,901 16,373 16.20% 9,894 9.80%
2010 208,826 104,413 17,118 16.40% 10,524 10.10%
2009 214,240 107,120 16,943 15.80% 10,261 9.60%
2008 196,934 98,467 16,033 16.30% 10,391 10.60%
2007 226,054 113,027 20,935 18.50% 14,439 12.80%
2006 283,396 141,698 28,147 19.90% 19,565 13.80%
2005 362,088 181,044 36,768 20.30% 24,383 13.50%
2004 361,850 180,925 37,612 20.80% 24,795 13.70%
2003 325,300 162,650 33,764 20.80% 22,149 13.60%
2002 302,486 151,243 32,883 21.70% 21,986 14.50%

Notes: * Transactions are one side of the sale. Total Units Sold would be half of Total Transactions. ** 2014 Sales are through Aug. 31, 2014

MRISSameOfficeSameAgentSales092914

Note from MRIS: For listings that had days on market of 0 and 1 day, which we typically believe are pocket listings, we have the following numbers:

2014 YTD: 4.3%
2013: 4.4%
2011: 2.8%
2009: 2.9%
2007: 3.0%
2005: 7.6%

Comps-only double-ended deals:

Year Total TransactionsComps Only* Total Comps Units Sold Same Office % of Total Units Sold Units Sold Same Agent % of Total Units Sold
2014 YTD** 3,144 1,572 461 29.30% 402 25.60%
2013 6,054 3,027 786 26.00% 656 21.70%
2012 5,034 2,517 665 26.40% 544 21.60%
2011 4,158 2,079 549 26.40% 475 22.80%
2010 4,410 2,205 533 24.20% 471 21.40%
2009 4,320 2,160 620 28.70% 562 26.00%
2008 4,130 2,065 484 23.40% 451 21.80%
2007 5,834 2,917 681 23.30% 627 21.50%
2006 8,180 4,090 862 21.10% 784 19.20%
2005 102 51 13 25.50% 13 25.50%

Notes:  * Transactions are one side of the sale. Total Units Sold would be half of Total Transactions. ** 2014 Sales are through Sept. 30, 2014

From MRIS: As it relates to comps, we don’t have reliable data prior to 2006. At that time MRIS made changes to its system to provide for the tracking of listings entered for comparable data. “Comps only” is a term used for agents to enter sales of properties not in MRIS. A comp is submitted after settlement.

MRISCompsOnlySameOfficeSameAgentSales2005to2014