The NAR Clear Cooperation Policy states that every listing must be inputted into the MLS within one business day after it is advertised publicly. The idea is to ensure that every agent has a chance to sell it.
Our boss is leading the effort to end the CCP (see above).
Anywhere (Coldwell Banker, Sotheby’s, etc.) also agrees that the CCP has its flaws, and that it needs to be revised or ended.
Asked Thursday about Anywhere’s proposal to modify Clear Cooperation, Reffkin said that “although I would prefer a policy that replaces the one-day listing requirement with 60 days as the DOJ has publicly asked NAR to do, I support Anywhere’s recommendation to move it to ‘at least a few weeks.’”
Reffkin’s mention of the DOJ refers to a July 29, 2020, letter from a U.S. Department of Justice attorney to a lawyer representing NAR. In the letter, the DOJ attorney proposes two modifications to the Clear Cooperation rule: extending “from one business day to sixty days the time by which listing brokers must submit listings to the MLS”; and eliminating “the exception to the Clear Cooperation Policy for ‘office exclusives.’”
Reffkin said that he applauds “Anywhere for advocating for homeowner rights.”
A survey was sent to agents on the topic. My response:
I think the CCP should end. No matter what the rules are, agents will game the system. For example, agents input their listings onto the MLS to reach the waiting buyers but then don’t allow other realtors to show. Then a few days later, they are marked pending. It has always been like this – no matter what the rules are, agents will game the system in their favor to maximize their own profits.
The San Diego region has always had agents who cheat the system – it’s been like this since I started. Let’s just be honest with consumers and with each other – it is the WILD, WILD WEST!
There isn’t a real threat of physical harm, but the environment will rough you up mentally and emotionally. Hire an agent who recognizes the pitfalls, and can help manage the experience as best they can.
I’m stealing this comment from an Inman poster but I think it addresses the elephant in the room. Compass, Anywhere and the large brokerages will be massively rewarded if CCP is removed by allowing all of their listing to stay inhouse. How does that benefit the consumers?
From Mike Drutar:
Changes, yes. Scrapping it, no. Understand the silent part that is not being talked about. These companies want to create in-house exclusives so that they can push their sellers to do it (without mentioning the Bright MLS study that they would lose up to 17% off the price), and create what is essentially a closed marketplace. They will then leverage access to their closed marketplace in recruiting agents and getting buyers to sign exclusive rep agreements. Buyers will be harmed because they will be forced to sign with a brokerage exclusively, which means they will miss out on the other closed marketplaces. Additionally, this is a networking business and the echos of Fair Housing issues still persist- these closed networks will be more inaccesible to people in minority communities. Changes, yes. Scrapping, no.
I’m stealing this comment from an Inman poster but I think it addresses the elephant in the room. Compass, Anywhere and the large brokerages will be massively rewarded if CCP is removed by allowing all of their listing to stay inhouse. How does that benefit the consumers?
Yes, you are right to question the benefit, if any. Those like Reffkin are right to point out that sellers should be allowed to do as they wish, but admittedly it’s a little flimsy when we are supposed to be advising sellers on what’s best for them. If the CCP or any other rule could guarantee an end to the shenanigans, then great. But it cannot.
I’m sure you can see my point – let’s do away with all the rules and let it rip. At least it would be honest (and expedite the auction format).
Other shenanigans:
Put for-sale sign in front yard and sell direct to the first buyer who calls. A blatant violation of the CCP, but agents don’t care, especially when they are desperate.
Agent sells the home offline, but to a buyer who has an outside agent – and never reports it anywhere. When asked why she did it, the answer was, “Well, hmmm, that’s the way the seller wanted to do it”. Isn’t it your job to encourage the seller to seek full-market exposure? It’s in their best interest. But agents don’t want to work too hard when they can make an easy deal right in front of them and go back to watching the Love Boat.
These companies want to create in-house exclusives so that they can push their sellers to do it
This is allowed within the CCP yet the success rate of selling the listing in-house is very low (I’m guessing 5% max right now). Compass could rev up the effectiveness of promoting our Private Exclusives within the office but it would be a long hard grind to create a closed marketplace. But it could happen.
It is the #1 reason why I agreed to join Compass six years ago. I saw the threat of a big brokerage commandeering the market and creating a closed marketplace. We could still pull it off – but there isn’t a management desire to do so, at least so far. Remember that he came from Wall Street – he’s never walked in our shoes.
Should I ever sell another property I fully expect prospective agents to provide a comprehensive proposal with fees and expenses spelled out in a competitive bidding process.
Yeah, I know it sounds easy and your model of having them bid against each other for the listing sounds like a fantastic way to select the best agent. It is!
But once you hire the listing agent, then what happens?
There is the preparation period, and that’s when it gets murky. Is the listing agent exposing to your coming-soon home to buyers (or agents) while it’s being painted?
I have three signed listings now that have been in prep mode for weeks, and there is still more time needed before they are ready. But I don’t want to tell anyone about them, because the maximum urgency is created when a fresh new listing hits the open market (usually on a Thursday).
That’s what is best for the seller – but is it a standard practice among realtors? NOOOOOOO. Most want to play around by inputting their listings as a Coming Soon but only after they have shopped it around their personal stable of buyers and then around the agents in the office.
I fully expect any preliminary bid to include a meeting [splitting the bill] for lunch. You can learn a lot about someone from the encounter. Do they know a hole in the wall great place? Do they apologize for not having a beer as they have an important meeting? Or vice versa. I would fully expect demands/questions. “You have to rip out those obscuring bushes.” “How much are you prepared to spend for preparation?” “Are you willing to wait for your price?”
These days we are talking multiple millions at stake. Don’t rush in. Get good help that you are comfortable with.
These days we are talking multiple millions at stake. Don’t rush in. Get good help that you are comfortable with.
Absolutely.
Escrow is closing on October 4th in potato land. Susie promises to tell her story of buying then selling again (she has moved three times since reading this blog).
In brief, she is passionate about real estate, and has learned a lot here. She relies on my assistance, but she knows to Get Good Help so we discussed at length how to hire the right listing agent in her area.
She talked to several, and she thought she nailed it. But it didn’t turn out like she expected.
I’ll let her tell the full story in a couple of weeks.
More stories:
I mentioned this one earlier. The listing agent who received five offers in the first couple of days on the market (it was a real creampuff!).
She told me that she was going to counter for highest-and-best which is a typical response. Even the bumbling idiots can figure out how to do that within 24 hours, so when we got to Day 2 and 3 then I knew I was going to get screwed.
Sure enough, after a week she lets me know that the seller decided to sell to a neighbor instead.
Of course, she round-tripped it.
To completely ignore five other offers to make your own deal should be illegal if you ask me. It is certainly unethical, but because there’s no Ethical Police, no one cares.
Oh Jim, can’t you just go sell your buyers another house?
No – they soured on the whole program and decided to stay in Austin and buy a brand-new home instead.
I’ll never forget the one during the short-sale days.
We made a written offer but back then it just meant that the listing agent would send it in to the bank clerks and hope something happened. As we documented here, there were plenty of shenanigans.
I’ll never forget her answer when I brought up the ethics of short sales: “Well, I’m pretty ethical” which isn’t exactly the same as being ethical. It’s like being pregnant.
She let the home get foreclosed instead, and she bought it herself at the courthouse steps and flipped it for a hefty profit.
How about that fiduciary duty to the seller?
You’ve really let the evil Jeannae out of the bottle here. Will the time come when a real estate representative needs a JD & Section 7 cert?
Soon, I hope!
Or just a real estate broker’s license?