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Some supporters of Clear Cooperation argue that removing the rule will lead homeowners to initiate a class action lawsuit claiming they lost money from selling their homes off the MLS. This hypothetical risk lacks credibility as hundreds of thousands of homes have sold off-MLS for decades without such litigation. These claims distract from the real issue: Sellers deserve choices, not mandates, in how their homes are marketed and sold.
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The potential legal risks of selling off-MLS can be addressed through a simple client disclosure, ensuring sellers make informed choices. Bright MLS (the second largest MLS in the country, operating in six states and Washington, D.C.) already requires a client disclosure form for all off-MLS listings, explicitly stating:
“I understand that, if I choose not to promote my home through Bright’s multiple listing service (MLS) on an impartial basis to the area’s brokers and homebuyers, then I am potentially leaving money on the table.”
Compass has created a similar client disclosure form and encourages other MLSs and brokerages to do the same. Disclosure also enables sellers to better understand their options, including the opportunity for pre-marketing before listing on the MLS.
Pre-marketing delivers better outcomes for homeowners
The goal of pre-marketing is not to sell off-MLS or create “pocket listings” — in fact, most homes that leverage pre-marketing are ultimately sold on the MLS. Compass research shows that Compass-sold homes that were pre-marketed off the MLS, before going active on the MLS, were associated with an average 2.9 percent higher close price. Pre-marketed homes also received accepted offers 20 percent faster and were about 30 percent less likely to have a price drop, on average, after listing on the MLS.
Compass supports homeowners’ right to pre-market their homes off-MLS to generate early demand and optimize pricing without the risk of negative insights such as price drops and days on market. As part of their fiduciary duty, real estate agents should feel empowered to provide the option of pre-marketing to achieve their clients’ goals.
By eliminating mandates like Clear Cooperation that limit the pre-marketing runway for homeowners, and by leveraging disclosure, the industry can promote homeowner choice, informed seller consent and better outcomes.
Robert Reffkin is the founder and CEO of Compass.
