Restoring the Norm of MLS Cooperation

Multiple listing services have until May 1 to implement the new Clear Cooperation policy, requiring participants to list publicly marketed homes.

“Have you ever received an inquiry about a property for sale but couldn’t find it in the multiple listing service?” Kathy Elson, CEO of Connecticut’s statewide SmartMLS, posed that question to a large roomful of MLS participants in January 2019. The overwhelming response was yes, and that, she told the group, is why the MLS would soon be requiring its participants to enter publicly marketed listings into the MLS.

At the time SmartMLS was one of a few MLSs to have implemented or considered such a measure. Now, a similar rule is poised for nationwide rollout. In November, the National Association of REALTORS®’ Board of Directors passed Statement 8.0 of the Handbook on Multiple Listing Policy, also known as the Clear Cooperation policy. The policy requires listing brokers to submit listings to the MLS for cooperation with other MLS participants within one business day of marketing the property to the public.

Not a “Coming Soon” Ban

There are misconceptions about what the Clear Cooperation policy does and doesn’t do, says Greg Zadel, who chaired the Multiple Listing Policy Committee that brought the policy forward. It doesn’t prohibit “coming soon” listings, office exclusives, or marketing to private networks. What it does is ensure that all MLS participants have a full view of the inventory in their market and sellers have full exposure of their property. It’s designed to shore up the pro-competitive, pro-consumer benefits that have long made MLS the defining marketplace for real estate. With new forms of marketing gaining ground, “we as an industry had started to drift away from the core purpose of that marketplace,” says Zadel, broker-owner of Zadel Realty, in Firestone, Colo.

So in an age when agents and brokers are urged to embrace change, who cares if properties are submitted to an MLS or not?

“REALTORS® care, consumers care, and it all boils down to the Code of Ethics,” said NAR General Counsel Katie Johnson in a 2016 video on off-MLS listings. “Any trend or business practice that results in less complete and less accurate property information should be a concern for REALTORS®.”

Following the video’s release, brokers and MLSs asked NAR to consider a policy to reinforce cooperation. An advisory board of brokers, AEs, and MLS executives studied the issue and formulated the Clear Cooperation policy after concluding that off-MLS listings not only skew market data and reduce seller and buyer choice but also undermine REALTORS®’ commitment to provide equal opportunity to all.

“Together, we made sure that cooperation remains the heart of organized real estate,” says Denee Evans, CEO of the Council of MLSs, which has three representatives on the advisory board.

Flexibility in Rule Setting

CMLS and NAR are now working to help MLSs, brokers, and agents prepare for the May 1 implementation deadline. MLSs will have flexibility in creating processes around the entry of different listing statuses, such as coming soon and office exclusives, and determining enforcement measures.

“Education is key,” says Elson, who traveled around Connecticut teaching brokers and agents about the SmartMLS rule. The result: “In the past, if someone called us about a coming soon or office exclusive listing, nine times out of 10, we didn’t have any information on it. Now, nine times out of 10, we do.”