When the National Association of Realtors (NAR) proposed banning most off-market and pocket listings in early October, it set off what is turning into an increasingly ferocious debate.
Soon, multiple listings services around the country were taking sides, famous agents were pushing back and, most recently, Compass has threatened legal action over Bright MLS’s version of NAR’s proposal. And the proposal hasn’t even become policy yet!
In light of the growing attention on the issue, Inman reached out to executives from major real estate firms across the U.S. to find out where they stand. For a variety of reasons, a number of companies declined to weigh in on the issue. But among those that did agree to comment, Inman asked them to explain their point of view and what impacts they see if NAR’s proposal becomes an actual policy.
Here’s what they said:
Glenn Kelman, CEO at Redfin
“I support it,” Kelman told Inman. “The industry has a long history of cooperating so that any consumer can see all the homes for sale. I don’t think people realize how easily the dream can collapse. And I don’t think they realize the stakes.”
Kelman went on to note that Redfin does use “coming soon” statuses, which allow listings to go up early. But significantly, he also said that this feature was a response to widespread industry practices rather than Redfin’s actual desire to create a pocket listing-type feature.
“I would like nothing more than to turn off ‘coming soon’ on Redfin,” he explained. “I just want to make sure that everybody else does it too.”
Kelman also pointed to social issues, such as historic racial segregation in the U.S. Those problems are exacerbated, in part, by certain people only having access to certain listings — which Kelman said NAR’s proposal tries to correct.
“It would be much better if we all played by the same rules,” he added. “If you believe that actually part of our society’s infrastructure is fairness, then make it fair. And we all know that it would be more fair if listings were published. That’s how the MLS took us out of the dark ages in the first place.”
Finally, Kelman concluded that “Redfin operates the number one brokerage website, and if we’re advocating for this who could be against it?”
“We are always in favor of the rule that favors the consumer,” he said.
Glenn Sanford, CEO eXp World Holdings
“I do support the policy,” Sanford said, though he added that he also believes “pocket listings will always play some part in the industry given an agent will often know of a listing that is going on the market at some point in the future.”
Sanford — whose background is in the Pacific Northwest where he said they don’t allow pocket listings — noted that in big expensive markets agents may be using off-market as lead generation tactics, rather than in an effort to get their sellers the most money.
NAR’s proposal, he added, “to some extent levels the playing field.”
However, Sanford also wasn’t surprised that some agents are resisting the proposal.
“I think that any agent, especially the profile of a sales person, generally speaking, is going to want less regulation than more regulation,” he added.
Sanford said that while some eXp agents might be affected positively and others negatively by the NAR proposal, he doesn’t think eXp overall will see much of an impact. Instead, he sees the impacts falling primarily on smaller companies.
“I think that the policy in my opinion benefits the smaller real estate players,” he said.
Nick Bailey, RE/MAX chief customer officer
“We respect the spirit of the proposal and have seen similar policies work in local markets,” Bailey said, “but whether or not it’s the right solution at the national level remains to be seen.”
Though Bailey wasn’t explicitly on one side of the issue or another, he did say that RE/MAX agents currently thrive in places both with and without policies similar to NAR’s proposal. The takeaway, then, is that “it’s agent quality and professionalism that matters most.”
“What we know and support is that consumers are demanding greater transparency and a better buying or selling experience,” Bailey also told Inman in an email. “As an industry, we need to continue to move forward and deliver on that. Consumers want to understand and benefit from the original MLS mission – the spirit of cooperation, clarity of compensation and fairness for all — but MLS fragmentation continues to make it challenging. That’s the bigger, more critical issue to address.”
Cory Perkins, Compass’ head of inventory, strategy and operations
Perkins told Inman in an email that Compass strongly believes NAR’s proposal “negatively impacts consumers, agents, brokerages, and the industry broadly.” Compass was also “surprised and disappointed to learn that” the proposal “would put direct restrictions on consumer choice while purporting to act in support of public interest.”
Perkins went on to argue that the kind of pre-marketing the proposal would limit does in fact help “consumers sell their homes sooner and for a higher price than listings that go straight to the broader market.” The proposed policy could also “stifle innovation” and negatively affect buyers who search for homes online, Perkins added.
“Imposing a one-size-fits-all approach limits consumer choice to pursue a more sophisticated marketing strategy that considers quantity, quality, and timing for exposure of their listing,” he said.
Perkins also took issue with the way the proposal handles “coming soon” listings, which Compass is well-known for using. Though NAR’s proposal ostensibly allows for coming soon listings, Perkins argued that “the current version of the policy provides little detail on how it will be implemented at the MLS level.”
According to Perkins, that situation in turn creates conflicts when it comes to consumer choice, and creates “exceedingly onerous and inefficient” burdens for national brokerages that are members of multiple MLSs and which would have to comply with various iterations of the policy.
Perkins ultimately concluded that the proposal “doesn’t deliver.”
“We believe the best possible outcome will be a policy that supports consumer rights and cooperation among MLS members without restricting any brokerage or agent’s ability to innovate and improve the home buying and selling experience for their clients,” Perkins said.
Editor’s note: In the time between Perkins weighing in on NAR’s proposal to Inman and this article going live, he also wrote to Bright MLS to oppose that organization’s version of an off-market listing ban.