MLS Faces Pressure to Pre Market Listings

The real estate industry is at a crossroads, with the Council of Multiple Listing Services (CMLS) taking a firm stance against private listings, while some Multiple Listing Services (MLSs) are adopting policies that accommodate the growing trend of pre-marketing.

According to the report, CMLS has criticized “large firms” for promoting a “false narrative” about the benefits of exclusive listings for consumers, without naming names, but the message seems to be directed at Compass, a brokerage that has been at the forefront of private listings.

Compass International Holdings CEO Robert Reffkin has been vocal about his criticism of MLSs that enforce restrictive policies around pre-marketing, including Northwest MLS, which Compass sued last year.

However, Reffkin has also praised several MLSs for creating flexible “seller-choice frameworks” that allow brokerages to enter coming-soon and office exclusive or private listings, including BAREIS, Bright, Canopy, HAR, MLS Listings, MLS PIN, MRED, Realtracs, SFAR MLS, The MLS/CLAW, and Unlock MLS.

Unlock MLS recently launched a new pre-marketing program called Flex, which allows agents to enter a listing in the MLS without days on market or price changes being tracked until the listing is fully active.

“I can’t speak specifically to Compass’s strategy,” Unlock MLS CEO Emily Girard said, “but there’s opportunity to use Flex to test price, to get initial feedback from professionals and their clients on the listing before going full-active.”

Bright MLS has varying degrees of active and coming-soon listings, as well as an option for office exclusives, all of which line up with Compass’ strategy, although the MLS’s statuses were in place long before Compass launched its marketing approach.

“Our statuses allow them without penalty in our market to do their 3-phased marketing plan,” Bright MLS CEO Brian Donnellan said. “And at some point, if everybody’s got a private exclusive, then it’s no longer really private, is it? So maybe these things have a way of working themselves out.”

Hud Bixler, chief information officer at the San Francisco Association of Realtors, said he didn’t think the association’s MLS was “that far apart” from Compass, adding that members “would be very vocal if our process wasn’t working for the market.”

Some MLS leaders were hesitant to say whether their policies were in conflict with CMLS’s stance on selectively marketed listings, but Unlock MLS noted that the display of market information, such as price changes and days on market, should be done with more caution when listings are in a pre-market or private status.

MLSs Navigate the Pre-Marketing Landscape

There is a conflict between the adoption of pre-marketing policies by some MLSs and CMLS’s underlying principles, and MLSs must navigate this new territory.

According to Girard, the complete picture lives within the MLS, where full listing history and context are preserved, and that context is critical and is best interpreted with the guidance of a licensed professional who understands the nuances behind a listing’s timeline, preparation, and market readiness.

“Transparency and context are not in conflict, but one without the other does not fully serve the consumer,” Girard added.

As the industry continues to evolve, it’s clear that MLSs will play a crucial role in shaping the future of real estate marketing, and their decisions will have a significant impact on the apartment supply.

Pre-Marketing Policies Vary Across MLSs

A review of the policies of various MLSs reveals a range of approaches to pre-marketing, from strict rules to more flexible frameworks.

While some MLSs, like Northwest MLS, have been criticized for their restrictive policies, others, like Unlock MLS and Bright MLS, have been praised for their more flexible approaches, which can be beneficial when utilizing a wholesaler.