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For decades, the real estate world we’ve known has been stable and orderly — allowing sellers, buyers, brokers, agents, municipalities and states to benefit from the robust and healthy market.
That is, until news of the proposed National Association of Realtors’ antitrust settlement earlier this year sent shockwaves across the industry. MLSs are grappling with the responsibility and methodology for implementing and enforcing the terms agreed to by NAR in the settlement agreement.
At this time, there are lots of tactical questions still to be answered, but there is one question that we do have an answer for: Will an MLS remain a valuable tool even without the ability to display buyer-broker compensation?
The short answer? Yes.
MLSs will continue to provide the most up-to-date and accurate market data and property listings. They will also have expanded opportunities to provide the tools, support and training real estate professionals need to succeed. NAR reviews MLS platforms and issues a Handbook each year of best practices and guidelines for MLS boards and entities to follow.
Now, as compliance becomes even more top of mind for the industry, an MLS will have an enhanced role as a reliable resource to support professionals in following these developing procedures.
MLSs have historically contributed to market stability
Traditionally, MLSs have provided value in a variety of ways — including contributing greatly to creating a single stable network for listings — benefitting real estate pros and consumers alike by:
Maintaining a steady and secure network effect
The network effect has provided a dependable listing and buying network — creating a singular destination where an area’s buyers and listings are in the same place. The network effect has always been more important to consumers (and professionals) than publishing compensation and will continue to benefit consumers (and professionals) after the settlement.
Creating a transparent market
We’ve traditionally had the luxury of a transparent real estate market where nearly all available property for sale is visible to those in the market to buy, along with the percentage fee being offered in each transaction. MLSs have worked hard to maintain that network, and without this transparency, it will be harder for buyers, especially first-timers, to know and understand what is available to them.
Preventing a fractured market
Without a widely adopted MLS, properties might only be accessible in portions, with some on company websites, some on MLSs and some in other scattered areas. This would make it more difficult to ensure that sellers see every listing, more challenging and time-consuming to navigate for real estate professionals, and could create an opportunity for consumers to ultimately miss out on their dream home.
These are just a few ways MLSs have historically contributed to a steady, reliable market — but our industry faces a troubling new landscape.
In a suddenly uncertain market, MLSs provide a level of certainty
In this changing environment, the role of an MLS going forward is even more crucial. There is a greater opportunity for the MLSs to provide the most accurate and expansive data and, ultimately, information on listings that is more in-depth and up-to-date.
In this rapidly evolving market, MLSs can significantly influence innovation and adaptation. Here are a few key areas where there are significant opportunities for MLSs to create and retain value in our new market:
Enhanced collaboration between MLSs and associations
Collaboration between MLSs and associations will bring more value while creating a network that isn’t restrained by geographic boundaries. These collaborative arrangements would also enrich the products and services being offered while empowering users with unmatched insights into the current market.
Improving data accuracy for increased customer satisfaction
By maintaining the most up-to-date information, MLSs cultivate trust and loyalty among users. Happy customers are paramount to the success of a thriving MLS, and by consistently delivering accurate data, MLSs ensure they are the go-to source for the most reliable market information.
Creating a more streamlined user experience
MLSs must continue to make platforms easier to use. Designing an accessible and intuitive interface with user-friendly features allows seamless navigation, as both real estate professionals and consumers will be seeking enhanced productivity and efficiency. By making their products more accessible, MLSs reinforce their role as indispensable tools and empower users to achieve their goals with ease.
Final thoughts
The bottom line is that MLSs will still provide stability for the network and marketplace — but the settlement brings concerns that could create significant headwinds and mark a significant step backward for our industry. We must do our part to provide increased and lasting value for MLSs, making them a provider of positive solutions for our industry in a time of significant disruption.
Stuart White is the president and CEO at Realtracs, Inc. Connect with White on LinkedIn.
