Robert the big boss was in town yesterday.
He is committed to changing or ending the Clear Cooperation Policy, which is a controversial stance.
The CCP makes in mandatory that every agent upload a listing onto the MLS within one business day after any public marketing of the property. Robert (and other brokerage leaders) say that nobody should have the right to dictate how a home is sold, and sellers should have the right to market their property however they choose.
Skeptics think that is a thinly-veiled excuse to hold more listings off the market, and sell them in-house instead – which would benefit the bigger brokerages, and possibly squeeze out the little guys.
But Robert said that the real problem is that we are sitting ducks waiting for another class-action lawsuit.
The last lawsuit was about the mandatory requirement that the listing agent include a buyer-agent’s commission rate in every MLS listing. NAR tried to hide behind the fact that the rate was negotiable, but got their clocks cleaned when the jury found otherwise. Even though Compass had never sold a home in Missouri, the forced NAR settlement cost Robert and Compass $52 million.
Because the submission of a listing to the MLS within 24 hours is also a mandatory requirement, it’s only a matter of time before the class-action attorneys start lining up for another big pay day. He is literally hoping to change the CCP before we get sued again!
NAR doesn’t get it. Their chief legal counsel quit last week after 17 years, which leaves them adrift, and they are sure to bungle the next wave of lawsuits which should be arriving any day now.
Robert is taking the high road and trying to negotiate a peaceful change, but I don’t get the feeling that the people in power are listening. This is where the biggest brokerages will probably have to sue NAR to get their attention before another class-action lawsuit is filed.
Why doesn’t NAR stand up for realtors? The main reason is because they have $750 million in the bank, and they are very comfortable. They had two presidents quit, the executive director retire just in the nick of time to avoid responsibility for the last lawsuit, and now the chief legal counsel quit too. They aren’t equipped to handle any controversy, let alone one that could put them out of business.
But that day is coming, it’s just a matter of when.
Abolishing the CCP is just the start.
Eventually, the biggest brokerages will quit NAR and the MLS, and go it alone, just like the commercial brokers. Zillow and Homes.com will scramble to make deals with us to keep our listings coming, because if they don’t, they will be out of business too.
I guarantee that this is the future of home sales.
It’s just a matter of when.
Seems like everything is being sold off-market up here in south Orange County. I was wondering why very little was making it to MLS until I started talking with some agents. I almost gave up and moved back down because for $4M you can actually get a nice house and some land there. Absolutely the weirdest market I’ve ever seen, and I’ve been ranting about real estate for like 20 years now. Hope you’re doing well.
Yes, and everything is trending in the same direction.
Putting a home on the MLS now only provides a channel for listings to reach the outside search engines. That’s it – no other benefit.
It used to guarantee the buyer-agent compensation, but no longer.
The MLS companies make money from selling our listings to outside companies. Those outside companies make money by manipulating our listings. Zillow displays them to the public and then sells the leads, Redfin spoons the inquiries to their own agents, and many others have their own uses.
The MLS companies don’t share any of that money with me. It’s my listing, yet the arrangement requires that I submit my listing within a day so they can make money off it.
Not for long.
I don’t think Robert wants to go it alone. But all we need is Realogy and/or Berkshire to join in the fight. Then we quit the MLS and NAR and you can find all of our listings at compass.com and be directed to the listing agent.
1. Much more efficient for buyers.
2. Sellers get their hired experts handling the buyer leads, instead of agents who have never seen the property and are junior agents working on a team at another brokerage.
3. Compass gets a boost for recruiting.
If it closes down the marketplace, then blame NAR/MLS for providing no value. All of the listings will still be available to the public – they will need to find them at each brokerage’s website just like with commercial properties.
Welcome back Genius – thanks for checking in. You should buy a $4,000,000 home here – and I can help you with that! 😆
Zillow Home Loans is now active. You (we) called it long ago. Change will accelerate. The idea of no one being a fiduciary is scary. Where all this is headed makes Ticketmaster look like a charitable organization.
Playing it safe and not wanting to offend anyone is going to cost NAR the ballgame.
They want to protect all the agents, productive or not, so they can feast off the dues every year.
Why does a non-profit trade organization need $750 million in the bank?
One other unfortunate part of the CCP:
A Compass agent was about to go live with a new listing on the MLS. The for-sale went in the yard, and she is uploading the new listing onto the MLS.
The owner’s son calls and he doesn’t like the photos – he hates them.
Agent stops the process and orders new photos to be taken the next day.
An outside agent sees the for-sale sign and turns in the Compass agent to the MLS because the listing wasn’t uploaded within one business day. It took three because of the new photos.
The MLS fined her $5,000.
It doesn’t go to charity or anything. It’s how the MLS makes big money off agents.
Oh. My. Gawd.
Thats horrendous. I need to call you brother you’ve been so accurate on many multiple fronts.
Sincerely,
Paul
We need to round up all the best agents and stick together!