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Beginning Jan. 1, 11,000 agents in Phoenix will have a new membership option in the local Realtor organization that will provide an alternative to joining the National Association of Realtors and state association.
Citing a wave of settlement agreements, Phoenix Realtors announced MLS Choice, a membership level that would save agents hundreds of dollars a year while providing access to state-compliant forms and legal help.
The option comes as pressure mounts on Realtor organizations to decide whether to change the so-called “three-way agreement,” a NAR policy that requires agents to be members of the local, state and national Realtor organizations simultaneously if they want to be Realtors.
MLS Choice as an update to MLS Only, a predecessor in use by some brokers in Arizona in cases where agents aren’t required to maintain three-way memberships to access the Arizona Regional Multiple Listing Service, Phoenix Realtors CEO Andy Fegley told Inman. Beginning next year, MLS Only will become MLS Choice, he added.
“It’s modernizing the option of MLS Only to accommodate and provide choice to brokers to then provide choice to their agents to conduct their business,” Fegley said. “For it to be a choice, we have to provide all the tools necessary for real estate professionals to do their job.”
The new membership option will cost $249 a year, less than half the $511 annual cost to join NAR, the Arizona Association of Realtors and Phoenix Realtors. Fegley declined to tell Inman how much the MLS Only option cost. Real Estate News first reported on the updates.
MLS Choice members wouldn’t be able to call themselves Realtors, which is a trademark owned by NAR.
“I think it’s a great idea, personally,” said John Wake, a real estate market analyst in Phoenix who added that he would be interested in the new membership tier. “I just paid last week to renew my membership for a year.”
Wake added that he had never heard of the MLS Only membership option, and that he was eager to compare the new forms with the ones created by the Arizona Association of Realtors.
“Is the contract different somehow? Maybe it’s simpler. Maybe that’s part of it,” Wake said. “The contract and the MLS are the reasons you joined NAR.”
The settlements with brokerages and franchisors stemming from the Sitzer | Burnett verdict and ensuing copycat lawsuits removed the requirement that agents join NAR in order to affiliate with those brokerages and franchisors. But the nation has yet to see a wave of MLSs that provide access to agents who aren’t local, state and national Realtor members.
Brokers in three states have filed antitrust litigation challenging the three-way agreement, and at least one Realtor organization publicly asked NAR to end it.Earlier this month, NAR CEO Nykia Wright defended the three-way agreement at the organization’s annual meeting in Boston. Before nearly 1,000 directors, Wright said she aimed to highlight the benefits provided at all organization levels.
“Some of you have heard rumblings of the challenging of the three-way agreement,” Wright said. “Well, we are here to make sure that those rumblings subside because it is our duty to make sure that people understand what happens at the local level, the state level and the national level, and really make sure that people understand that there isn’t a cannibalization of services, but it really is working together … to make things work.”
In Phoenix, brokers who opt into the MLS Choice program would receive fewer discounts, tools and education resources than those who opt into the three-way agreement. They would also not have access to medical, dental, vision and other discounts. They would not be allowed to call themselves Realtors.
They would still receive some local business discounts, free continuing education, office space reservations, market stats, listing media service and access to the broker legal helpline, along with the legal forms.
The group said the change was possible because of a change NAR made in 1994, which eliminated the requirement that participants in Realtor-association MLSs must be Realtor association members. That left MLSs to decide whether subscribers needed to be Realtor members, which has remained a common requirement today.
Phoenix Realtors said it had created a new set of forms for MLS Choice agents to use that comply with state law.
Editor’s Note: This story was updated to more accurately reflect the three-way agreement, and to correct the date of a past NAR change.
