The MLS Technology and Emerging Issues Advisory Board, of the National Association of REALTORS® (NAR), proposed a rule change that is sparking some controversy among its’ members. The proposed “Clear Cooperation Policy” requires that all listings be put in the MLS within 24 hours of “marketing a property to the public“. The policy defines “public marketing” as including, but not limited to, “flyers displayed in windows, yard signs, digital marketing on public-facing websites, brokerage website displays (including IDX and VOW), digital communications marketing (email blasts), multi-brokerage listing sharing networks, and applications available to the general public”.
But, isn’t that how it is now?
Many consumers may having been thinking that this is how it was all along, that new listings were required to go into the MLS but, that is not currently the case. Presently (and going back to the beginning of the MLS here in St Louis, I believe), agents have been able to determine the best marketing methods for their client, as well as allow their client input as to whether they wanted their listing in the MLS immediately, after a period of time or even not at all.
Why wouldn’t a seller want their home in the MLS immediately?
Sometimes it does make sense for a new listing to be entered in the MLS immediately and, other times, it is not necessarily in the best interest of the seller to do this. There are many, many factors that affect the marketability of a listing and, while some of the issues can be corrected or improved (such as clutter, touch-ups needed, etc) some things cannot (such as proximity to highway noise, the slope of the yard, etc). An agents job is to try to determine the best way to market the home to accentuate the positives and overcome the negatives. The agent also needs to look at the current market conditions for that listings specific area and price range.
After analyzing everything, there are many occasions when the agent determines it’s in their seller’s best interest to either not put the listing in the MLS right away, or not put it in the MLS at all. Some of these scenarios are:
- When in a seller’s market with low inventory (like most of St Louis has been in for the past couple of years now) it is often beneficial to the seller for the agent to take advantage of the shortage of available homes and do a coming soon campaign in advance of putting the home in the MLS to create buzz, hype and anticipation about the listing coming on the market. Part of the “magic” in this type of campaign is offering limited information and limited photos (often just 1 exterior). The idea is to make consumers contact agents for info and agents contact the listing agent for info. This gives the listing agent a very targeted audience to focus their attention on so they can get additional information to them as it is available and schedule showings once available.
- If the seller is a high profile individual (celebrity, athlete, CEO of a public company, etc) they often want to go to great lengths to protect their privacy. This often includes not wanting their listing (and all the information and photos) to be publicly available. Instead, the listing agent may just market the listing directly to key agents known to be active in that price range and market as well as directly to select prospects they feel may be a fit.
- There are situations where a seller either wants or needs an immediate sale and does not want to use traditional marketing methods, like the MLS. There are times that due to the condition of the property, financial situation or a time-sensitive condition, that will cause the seller to want the listing agent to make the listing only available to professional investors, builders, etc.
Why is NAR considering this new rule?
The MLS Cooperation Proposal gives the following statement as the rationale for the proposal:
“Distribution of listing information and cooperation among MLS participants is pro-competitive and pro-consumer. By joining an MLS, participants agree to cooperate with other MLS participants except when such cooperation is not in their client’s interests. The public marketing of a listing indicates that the MLS Participant has concluded that cooperation with other MLS participants is in their client’s interests. This policy is intended to bolster cooperation and advance the positive, procompetitive impacts that cooperation fosters for consumers.”
It’s not a done deal…
At this point, the policy is a suggestion and is being discussed within the industry. The plan appears to be for the NAR Board of Directors to vote on the policy in November.
