The Clear Cooperation Policy has had the unintended adverse effect of encouraging office-exclusive listings rather than genuine MLS cooperation. I have been waging a war against clear cooperation since it first came up in conversation. The articles are a good read. The rule was intended to weaponize the MLS against private listing networks. It created more.
Office exclusives have become more prevalent today than any other time in my history in real estate. I hate office exclusives for all of the reasons everyone else does, but without a more flexible MLS policy, the nation will see more office exclusives and fewer listings in MLS cooperation. Here is our understanding of the problem and how to fix it.
Across the country, MLSs impose widely varying restrictions on how brokerages may market and show properties. Some permit appraisal-related information, such as days on market and price changes, to be displayed publicly – and that hurts the seller. Keep those confidential in the MLS for research, statistical and appraisal purposes, not displayed publicly.
Others require “coming soon” listings to convert to active status within one day, seven days, 14 days, 21 days, or 31 days. These inconsistent and often inflexible rules create fatigue and frustration for agents and sellers alike. The seller does not comprehend how these MLSs “tell them” how to sell their property. That is the agent and broker’s job. (Head-nod to Clayton Collins of HousingWire who just went through this hassle!) Let listings be in the MLS as long as the seller wants. Arbitrary dates hurt cooperation and cause agents to put listings in private exclusive while the seller gets ready to move.
A growing number of MLSs have adopted variations of a more practical cooperative model, allowing listings to be submitted for cooperation among MLS subscribers without necessarily requiring immediate public distribution. Examples include CRMLS, Miami Realtors, Bright MLS, MRED, MLSListings, MLS PIN, REcolorado, Garden State MLS, West Penn Multi-List, Canopy MLS, Greater Cincinnati MLS, The MLS/CLAW, realMLS, Northeast Oklahoma Real Estate Services (NORES), Emerald Coast MLS, Stellar MLS, NTREIS, UtahRealEstate.com, and MLS NOW. In every single market, the number of office exclusives have dropped to some of the lowest numbers in the nation.
Although the precise terminology and requirements differ, these policies recognize an important distinction: cooperation with other real estate professionals does not have to mean immediate advertising to the general public. I wrote a whitepaper about the listing IPO – please read it.
This approach harkens back to the original purpose of the MLS. Brokers contributed their listings so they could cooperate and share information with every broker and agent in the marketplace.
That was the MLS bargain: put the listing in the MLS and cooperate with the marketplace. In return, the listing broker remained free to advertise, prepare, and show the property in the manner authorized by the seller.
The experience of DJ Grubb, broker at The Grubb Company in San Francisco’s East Bay, offers a useful example. BridgeMLS does not provide a sufficiently flexible path for MLS-only cooperation. The result is a market with substantially more office-exclusive listings than other parts of the Bay Area served by organizations such as BAREIS, the San Francisco Association of Realtors, and MLSListings.
This is not an indictment of a particular broker or brokerage or an MLS. It illustrates an MLS policy problem. When an MLS makes cooperation unnecessarily burdensome—or attaches restrictions that interfere with a broker’s ability to advertise and show a property according to the seller’s instructions—brokers and sellers naturally look for alternatives. Office exclusives become one of those alternatives. Everyone who rails against office exclusives is right, but don’t condemn the practice if the MLS policy forces it.
MLS rules should not unnecessarily dictate how brokers deliver services to their clients. Sellers may need time to improve a property before broad public marketing, thereby maximizing its potential sale price. They may want to limit showings temporarily, take a property off the market while traveling, or make other decisions based on personal circumstances. Rules that eliminate this flexibility interfere with the broker-client relationship and push sellers and their agents toward office-exclusive arrangements.
Every day, articles criticize brokerages for withholding listings from MLS cooperation. But when we examine markets with significant numbers of office exclusives, we repeatedly see the same correlation: the governing MLS has imposed mandates that restrict advertising, showings, or the seller’s flexibility.
I think that the transparency argument fails on some basic principles of reducto ad absurdum and slippery slope. When a listing is advertised, is cooperation in the MLS enough of a market reach (98% of homes trade through the MLS), or do I need Zillow, Realtor.com, Homes.com? Do I also need Craigslist, Facebook, Wall Street Journal? What about international markets? Must the listing really be everywhere possible on earth to reach the buyer pool. My argument is no. Just contribute it to the MLS for cooperation and the buyer will find it if they are serious.
The solution is not another layer of mandates. Fix the MLS rules that unnecessarily limit how listing brokers may advertise and show properties. Provide a practical MLS-only or subscriber-only mandatory submission option. Require cooperation through the MLS while allowing brokers to market and manage each listing according to the seller’s lawful instructions.
We have seen the result across markets: when the rules make cooperation practical, brokers cooperate. When the rules make cooperation restrictive, office exclusives proliferate. Restore flexibility, and office-exclusive inventory will decline.
The industry needs a serious discussion about returning the MLS to its cooperative foundation. The objective should be straightforward: require brokers to share listing information with the MLS marketplace while preserving the seller’s right to determine how and when the property is advertised and shown.
I thought about an entire section in this article about privacy. That is another missing narrative of the conversation. More buyers and sellers are looking for privacy and confidentiality than the transparency advocates acknowledge. I would never agree to buy a home that has my daughter’s future bedroom all over the internet, complete with floor plans. I expect that a lot of people feel that way.
Give brokers a workable path to cooperation without unnecessary limitations, and cooperation will follow. And here is something that you can see coming a mile away.
Compass is rolling out their Home Platform to 340,000 agents and their clients. If you thought that Compass Private Exclusives erode MLS participation, consider what it looks like when you roll in Anywhere. Let’s fix it and go back to core MLS principles, and get those office exclusives back in the MLS cooperation.
If your MLS or brokerage is evaluating Clear Cooperation, office-exclusive policies, or the future of listing distribution, WAV Group can help. Our team works with MLSs, brokerages, and industry leaders to develop practical listing policies that increase cooperation while preserving seller choice. Contact us to start the conversation.
