Protecting the Best Real Estate System in the World

Something very positive occurred last weekend at the National Association of Realtors conference, when the Clear Cooperation Policy, otherwise known as MLS 8.0, was overwhelmingly passed.  In a world where we are confronted with crazy, irrational news every day, it is incredibly refreshing to see sanity prevail.

This policy halts the growing pivot to private listing platforms we’ve seen promoted by brokerages and networks that espouse “consumer interests” while in fact furthering their own competitive advantage by hoarding listings rather than exposing those properties to the broadest pool of potential buyers possible.  Quite simply, this is not a consumer-friendly practice, but rather, one of self-interest.  That’s not to say that in our free enterprise system, a brokerage shouldn’t have the ability to differentiate themselves competitively, but not at the expense of the industry at large and the homeowners we all serve.

How can one possibly argue that reduced competition for a particular property is beneficial to that seller, or that the interests of buyers are served by having access to even fewer properties in an already tight supply market?  It is not the broker’s prerogative to pick and choose who should be given the opportunity to buy a particular home based on access.

In my career I’ve been blessed to meet and work with many real estate professionals from around the world.  Without exception, they are envious of our MLS system and the spirit of collaboration that inspired its creation as early as the late 1800s.  Why in the world would we want to destroy at worst, or marginalize at best, the system of cooperation and compensation, imperfect though it may be, that has served agents and consumers so well over the years?

This controversy is evidence of an ongoing argument about whether the customer of the brokerage is the agent or the end-user consumer, who writes the check.   I’ve always maintained that they are not mutually exclusive, that you can think “outside in” by providing consumer-friendly tools and processes and training agents to create exceptional real estate experiences.  That kind of brokerage brand equity attracts customers and reinforces relationships that agents have with clients and thereby supports their success. 

Few consumers who are educated on the ramifications of having their property be “off market” would elect to limit their opportunity.   In a tight inventory market like we have today, they may not be as disadvantaged as in other times, but diluting the effectiveness of the MLS with proposals like this present a slippery slope that will become hugely problematic when we face a very different market in which supply is no longer an issue.

Kudos to CMLS, NAR and brokerage leaders who have stepped up to take an important position that protects the MLS, an institution that makes the American system the most advanced and open real estate marketplace in the world.