CHICAGO — After much debate in the days leading up to Monday’s meeting of the National Association of Realtors board of directors, the board passed four multiple listing service policy changes with little fuss, including a broker-backed policy known as “MLS of Choice.”
The changes prevent MLSs from requiring agents to pay for their service even if they don’t want it, so long as agents can prove they subscribe to a different MLS.
MLSs will be required to provide a no-cost waiver of all MLS fees for such agents, and MLSs may, if they choose, require agents and their brokers to sign a certification for non-use of their MLS services, which, if violated, can include penalties (such as back-billing) and termination of the waiver.
The amended policies are MLS Policy Statements 7.42 and 7.43. The former previously allowed Realtor-affiliated MLSs to require that all of the licensed salespersons affiliated with a broker’s office subscribe to the MLS — if a broker is a member of the MLS and that broker’s office lies within the territorial jurisdiction of the association that owns and operates the MLS. The latter policy now includes the waiver mandate.
According to the brokers pushing for change, the policy as-is hurt agent recruiting and retention; forced brokers or their agents to pay for MLS services they did not want or find valuable; and discriminated against newer, tech-enabled business models.
Other MLS policies approved by the NAR board today have to do with broker access to sold data, property search results and MLS subscriber orientation.
- Sold data: Today’s vote amended MLS Policy Statement 7.58 to require MLSs to, at broker request, provide access to all available sold data maintained by the MLS starting from January 1, 2012 for display on the broker’s website. The policy had previously required MLSs to provide a minimum of three years of sold listing data. The amended policy keeps the existing exception for areas where sold information is not publicly accessible. The rationale behind the policy change was to allow brokers to compete on a level playing field with third-party listings portals, which do not have the three-year limitation.
- Property search results: The board amended the same policy, 7.58, to authorize brokers to return search results on their websites with no less than 500 listings or 50 percent of the MLS, whichever is less. This increases the previous minimum number of results to property searches that MLSs can mandate, which were previously no less than 100 listings or 5 percent of the MLS, whichever is less. The policy change, also meant to help broker websites compete, offers “less restrictive search parameters” and “a more robust search functionality,” according to NAR’s Multiple Listing Issues and Policies Committee.
- MLS subscriber orientation: The NAR board amended MLS Policy Statement 7.92 to require MLSs to make a remote training option for MLS orientation available to agents and brokers. The policy change is meant to ease potential administrative burdens on brokers and agents.
All four policy changes passed overwhelmingly, and three out of the four did not elicit any discussion from the 800-member NAR board.
The board voted to amend the implementation date of the “MLS of Choice” policy to July 1, 2018 from March 1, 2018 after NAR director and president of Cincinnati MLS David Welch proposed the delay.
He told his colleagues that for small and medium-sized MLSs, preparing for the change “will require thousands of dollars and many hours of work.” The MLIP Committee considered this same amendment on Saturday, but it was voted down. This time, no one disputed the amendment and it passed.
This may be because much of the debate happened before today’s board meeting. At MLS meetings held Friday and Saturday at NAR’s annual conference, MLS executives generally spoke in favor of the policy change, though some, like Welch, worried about the burden on smaller MLSs of policing violators. Many large MLSs have technology in place to catch unauthorized use of their services through password-sharing.
“It is more work. We don’t deny that. But the idea is that it’s a better marketplace for brokers and agents,” Sam DeBord — a broker, Inman contributor and member of the committee’s MLS advisory board — told conference attendees.
“In the meantime, there are software programs that folks use to see who is logging in, who is logging out. We don’t deny that it’s more work.”
Rick Harris, chair of the MLS advisory board, also noted that monitoring will come from other agents turning in their peers.
“I think you’ll find that other agents will help you be your enforcement agent,” he said.
Others worried about having incomplete data because brokers would not be allowed to submit listings to the MLS held by non-subscriber listing agents.
“When we start having differential data within the same marketplace” it’s not available for comps and “starts to skew the data a bit,” said Andy Meyers of the Arkansas Realtors Association.
DeBord and others noted that the rule change could actually encourage brokers and some of their agents to join more MLSs if all of the broker’s agents don’t have to join, thereby improving data.
Would an MLS rather have the broker not use their MLS at all or have some of their agents use it? Harris asked.
“Does it fix all of the market disruption? It does not. [But] I don’t believe … that this creates greater disruption in the market than the brokerage community is already experiencing,” Harris said, prompting clapping from attendees.
DeBord noted that the “thrust” of the policy change was to improve the relationship between brokers and MLSs.
Carl DeMusz, CEO of Northern Ohio Regional MLS, agreed. “[We] have to go back more than a year to realize just how bad the relationship was between brokers and MLSs,” he said.
If MLSs show brokers they’re listening, “then maybe they won’t come up with alternative plans to get around the MLS; maybe they won’t spend millions of dollars to get around what we do,” he said.