Anyone who knows me knows I don’t stay quiet about much. But on the private listing fight, I haven’t said much. I figured the market would sort it out now that inventory is rising and the success of “private listings” would be weakened.
I was wrong. Robert Reffkin is going too far, and somebody running a big independent brokerage needs to say it plainly.
So here it is. If Compass gets everything it wants, this industry is headed into an absolute listing war. Nobody wins that war. Not Compass, not my company and definitely not the people buying and selling homes. It will be true mutually assured destruction.
Anthony Lamacchia lays out his case against Compass’s listing strategy in an unscripted video posted Oct. 19.
‘Negative insights’ are just facts
Last week, Robert went on CNBC and called days on market and price reductions “negative insights.”
Let’s be real about what those are. They’re facts. How long a house has been sitting there and whether the price came down are two of the most basic things a buyer deserves to know.
And hiding them doesn’t make them go away. Appraisers use days on market when they value a home. That appraisal ends up in front of the buyer anyway. All you’ve done is make the buyer find out later.
As brokers, we don’t get to put our finger on the scale for one side of the deal. That’s the whole job. Here in Massachusetts last year, Compass represented buyers in about 47 percent of its overall sales transactions and sellers in roughly 39 percent.
So, you do more buyer business than seller business, but you want to hide the information buyers need most? Explain that one to me.
This is why I started my video out with “Robert Reffkin doesn’t care about buyers; that is my opinion after listening to him for the last two years … ” I also said it because he only talks in favor of listings and doesn’t seem to have any regard for transparency for homebuyers.
I would love to know where all the consumer advocates are on this because I don’t hear from many.
This is about the inventory, period
For years the story in this business was simple: There’s nothing for sale. Over the past year, that has finally started to change. There are roughly 1.7 million homes for sale in this country right now. That’s real progress.
Now imagine a big chunk of that inventory disappears behind private networks and “see it first” programs. Buyers can’t see it. Their agents can’t see it. The public can’t even see that the market is loosening up. At the exact moment affordability is the number one issue in housing, we’d be making homes harder to find, which puts many buyers at a disadvantage.
This should be a bipartisan issue. I’d love to see people on both sides of the aisle screaming about it, because hiding masses of homes from the public hurts everybody who’s trying to buy one.
Let’s call the strategy what it is
It’s about Compass doubling revenue per listing, trying to cause agents and buyers to feel as though they have to be with Compass to get full access to all homes for sale.
Compass says this is about seller choice. Sellers in my market already have choices. Choice isn’t the problem.
The problem is what happens in between. The pitch is that the home gets maximum exposure eventually, but only after the listing has been shopped inside the company first, so Compass has every chance to represent both sides and double its revenue on the deal.
Imagine sitting across from a seller and explaining that honestly. “We’re going to hold your home back from most buyers for a while so we have a better shot at getting paid twice.” Nobody says it that way, but that’s the truth of it.
Your own people are talking
Robert also says every MLS board member is a direct competitor of his. Here’s what he’s leaving out: Plenty of Compass brokers and Anywhere company leaders sit on MLS boards, too, and they have a real say in these policies.
Maybe they aren’t telling him how they feel. But I am hearing it. A lot of Compass agents and managers are uncomfortable with where this is going. Word has it, many franchise owners of Anywhere companies that are now owned by Compass Holdings are concerned.
Where a listing war ends up
Here’s my fear: If listings get chopped up across a dozen private platforms, the bigger firms are going to fight back. Companies like mine have leverage in the markets where we’re strong.
I am guessing there are other owners out there with the same attitude I have: You stop our agents from seeing your listings where you have a lot of market share, and we’ll do the same to you where we have a lot of market share.
I don’t want to go there. We should not go there. That’s a race to the bottom, and the consumer is the one who loses it.
Credit where it’s due
I want to be fair. Robert has built a hell of a company. He’s a smart, relentless operator, and I respect him and what he’s done.
He’s also right about some of his arguments. In some cases, MLS fines and overreach have gotten out of hand. A rules violation should be a slap on the hand, not a massive penalty. That’s worth fixing, and I’d stand next to him to fix it.
But you don’t fix the MLS by tearing apart the one system that lets every buyer see every home.
What I’m asking for
If you’re a Compass Holdings agent, broker, or franchise owner who is concerned, you need to tell Robert. Flood his inbox with emails. Tell him respectfully that he’s going too far.
You agents are the ones who face sellers and buyers every day. If enough of you speak up, he’ll listen. He has to.
We are happy to be initial members of Open Real Estate. Being part of a movement that will ensure buyers and sellers have maximum access and exposure is what we are all about.
The views and opinions expressed here are those of the contributor and separate from the Inman newsroom.
Anthony Lamacchia is the founder and CEO of Lamacchia Companies.
