All MLSs, which formerly used territorial jurisdiction to require participation by all agents of a real estate firm, are now required to offer waivers to real estate agents who want to opt out of that particular MLS.
Agents are now free to join another MLS if their broker belongs to it.
How did MLS of Choice come about?
I first introduced the concept in 2016 to Rick Harris, who was chairman of the MLS technology and emerging issues advisory board. I also contacted Andrea Brambila, deputy editor at Inman. She published an article about the idea, and it gained traction.
Harris and Sam DeBord, vice chair of the multiple listing issues and policies committee, studied the concept, constructed it and finally put it to a vote at NAR’s November 2017 meeting. Without the work of these two individuals, and the committee members, this difficult task may never have been accomplished.
How are the affected MLSs dealing with this new policy?
Although it may be too early to accurately measure the total effect these new policies will have, many associations and MLSs have been proactive.
NAR created MLS of Choice, but the implementation of it was left up to the individual associations and MLSs. The actions and policy changes that some of them have demonstrated could serve as an example to other associations and MLSs.
How is MLS of choice affecting the industry?
Martin County Realtors of the Treasure Coast
The Martin County Realtors of the Treasure Coast (MCRTC), located on the east coast of Florida, showed particularly creative and innovative ingenuity.
First, it changed its name from the Realtor Association of Martin County to Martin County Realtors of the Treasure Coast. This more accurately represented the “service area” of both the association and its MLS.
Then, under the leadership of CEO Janet O’Brien, President H.B. Warren, President-Elect John Gonzalez, Vice President Tom Baker and a forward-thinking board of directors, MCRTC took the surprising action of adopting MLS of Choice well in advance of NAR’s July 1 deadline.
It also did it just as its MLS billing was going out.
Taking advantage of the situation
Many MLSs were taking advantage of the July 1 deadline to get one last billing out while they could still enforce territorial jurisdiction. However, MCRTC MLS was doing just the opposite and embracing MLS of Choice.
What MCRTC understood was that there was a group of brokers and agents out there who wanted to join MCRTC MLS because of attractive events like its popular and highly successful weekly MLS Tour of Homes.
Additionally, its office location was close to many brokerage offices, which makes it easier to take classes or attend seminars.
The only reason these brokers didn’t join was because territorial jurisdiction would have required every agent in the broker’s office to join, so they joined a neighboring MLS instead. Once MCRTC MLS adopted MLS of Choice, this removed the 100-percent participation rule and opened the doors.
After implementing MLS of Choice in February 2018 and going through one full cycle of dues collection, MCRTC MLS lost a few agents and gained a few agents, showing no significant increase or decrease in its MLS membership.
The fact that it did not have a large decrease is the opposite of what some opponents of MLS of Choice were claiming would happen. It also shows what MCRTC has to offer.
A spokesperson at MCRTC commented: “The good news is that agents can now join any MLS of their choosing, where their broker participates, regardless of jurisdiction. It’s a win-win for all.”
MLS of Greater Cincinnati
In the case of the MLS of Greater Cincinnati (CincyMLS), I need to fall on my own sword. When MLS of Choice was brought up for a vote, the original effective date was to be March 1, 2018.
David Welch, the past president of a 6,000-subscriber MLS owned and operated by the Cincinnati Board of Realtors, voiced concerns that more time was needed to prepare. Welch, who’s also a director at NAR, secured a delay in the start date to July 1.
The need to address issues
I felt this delay was just a ploy to collect extra MLS fees since many MLSs would be billing and enforcing territorial jurisdiction during those extra three months. However, Welch was correct in stating that the MLSs needed more time to address implementation and budget issues.
To help with educating brokers and agents, CincyMLS produced a video explaining how MLS of Choice and CincyMLS will work. It also requires agents and their broker, which requests a waiver from joining CincyMLS, to attend a webinar about MLS of Choice and CincyMLS rules.
Addressing the teams dilemma
Another issue it addressed was how to deal with teams or groups when it came to waivers. What would prevent members of a team — a group of agents working together — from joining different MLSs and then simply all sharing their MLSs?
To solve that potential problem, if a team or group wants to use CincyMLS, then all members of that team or group must subscribe. It is an “all in or all out” approach to the issue.
Another area that was confronted was how to be sure listings in the CincyMLS service area are readily available to CincyMLS agents. There is nothing worse than having listings in the same city or county scattered among different MLSs.
We already have this issue in areas where there are two or more MLSs, but none of them will share data with each other. It is embarrassing to have clients ask about properties they found on Zillow, Trulia or realtor.com, but you can’t find them in your MLS.
To solve that problem, CincyMLS requires that the listings of Waiver Applicants in the MLS service area be entered into the CincyMLS under the broker’s name only. These listings may not be advertised under, or included in remarks under, a different contact name in the MLS, or using MLS distribution services.
What does the future hold?
It would seem certain that some associations and MLSs will merge with neighboring associations and MLSs. Others will improve services and use attraction to retain and even increase membership. However, the result will be a better MLS system, which is fair to both brokers and agents.
If your MLS would care to share how it has dealt with MLS of Choice or how MLS of Choice has affected it, send me an email at email@example.com or share your story in the comments section below.