Recommendations for Making MLSs More Transparent

An NAR advisory board is proposing changes to the MLS policy to ensure consumers understand agent compensation and have access to all listings.

UPDATED: This article was written following a Sept. 9-10 meeting of NAR'S MLS Technology and Emerging Issues Advisory Board and updated following an Oct. 5 meeting of the advisory board. It reflects recommendations coming out of both meetings.

The National Association of REALTORS®’ MLS Technology and Emerging Issues Advisory Board has passed a series of motions designed to ensure that association-operated multiple listing services are meeting the needs of consumers and broker subscribers. They would:

Prohibit MLS participants and subscribers from representing that their services as an agent or representative to a buyer or seller in a real estate transaction are free or available at no cost to their clients.
Prohibit MLS participants and subscribers from filtering or restricting MLS listings that are searchable by and displayed to consumers based on the level of compensation offered to the cooperating broker or by the name of a brokerage or agent. MLSs would also be restricted from enabling such filtering.
Require MLSs to include, on consumer-facing websites and in MLS data feeds provided to participants and subscribers, the listing broker’s offer of compensation for each active listing displayed. Under this recommendation, MLS participants or subscribers must be permitted to share compensation information though Internet Data Exchange and Virtual Office Website displays or through any other form or format provided to clients and consumers. The information must be accompanied by a disclaimer stating that the offer is made only to participants of the MLS where the listing is filed.

The advisory board also recommended changes to the IDX policy and the VOW policy that would make those policies consistent with the prohibition on filtering and restricting MLS listings.

“The advisory board moved forward with these recommendations because we think they ensure that MLSs are up-to-date with advancements in technology and consumer preference, operate with transparency, and maintain policies that make the consumer experience better,” says Greg Zadel, CRB, CRS, chair of the advisory board and broker-owner of Zadel Realty in Firestone, Colo. These proposed policies will serve the interest of consumers and reinforce what already exists in NAR policies and the Code of Ethics, he says.

Providing a Higher Level of Service

In a separate action, advisory board members approved a series of recommendations focused on improving the level of service MLSs provide to participants and subscribers.

The advisory board approved recommendations from the MLS Standards Work Group that would set best practices for:

Disciplining participants who violate MLS rules.
Informing participants on the MLS website about the data feeds and technical support available to them and their vendors.
Sharing aggregated data with state associations and NAR for statistical and advocacy purposes.
Clarifying MLS officers’ and directors’ fiduciary duty.
Developing an annual MLS strategic plan with specific consideration to leadership training, partnerships, technology, participant outreach, financial independence, and diversity, equity, and inclusion.

A sixth recommendation from the MLS Standards Work Group is that MLSs, by July 1, 2022, have a written plan with a timeline and cost estimate for coming into compliance with the Real Estate Standards Organization’s Data Dictionary.

These Work Group recommendations will go through the Multiple Listing Issues and Policies Committee in November but do not require an NAR Board of Directors vote, since they would not be mandated and would not create policy, says Zadel. Rather, MLSs would be asked to consider local adoption as a means of providing a higher level of services to participants and subscribers.

The Advisory Board also considered and approved recommendations that

MLSs be required to offer participants, or their designees, a single data feed in accordance with their licensed authorized uses.
MLSs be required to provide participants with a brokerage back-office feed of data as defined in the recommendation. The advisory board defined data to mean all real property listing and roster information in the MLS database, including all listings of all statuses available to participants. The definition specifically excludes MLS-only fields and fields and content to which the MLS does not have a sufficient license for use in the brokerage back-office feed.

Establishing standards for data feeds will make it easier for the brokers to incorporate MLS data into the many productivity tools and reports they use today in their business, says Zadel. “This will empower MLS participants with the information they need to better serve their clients and customers.”

Finally, the advisory board recommended changes to the IDX and VOW policies that would require participants’ IDX displays and VOWs to display the listing firm’s contact information “at least as prominently as any other contact information or lead form on the site.”

Ensuring that the listing broker attribution is clear would provide a more accurate representation to the public, Zadel says, would improve consumers’ ability to seek information on the property, and is consistent with the “True Picture” requirement of Article 12 in the NAR Code of Ethics.

If the policy recommendations are approved by the Multiple Listing Issues and Policies Committee at its Nov. 13 meeting and by the NAR Board of Directors at its Nov. 15 meeting during the REALTORS® Conference & Expo, the policies will go into effect Jan. 1, 2022, and MLSs will then have until March 1 to adopt changes locally.

Voicing Your Views

Comments and feedback on the proposed policies should be sent to NARPolicyQuestions@nar.realtor before the Multiple Listing Issues and Policies Committee meeting, which will be Saturday, Nov. 13, 10:30 a.m.–12 p.m. Pacific time.

Members and REALTOR® association executives attending the REALTOR® Conference & Expo in San Diego will also be able to provide feedback at the following sessions:

Multiple Listing Service Forum Breakouts, Wednesday, Nov. 10, 2–4 p.m. Pacific time

Multiple Listing Service Association Executives Forum, Thursday, No. 11, 9:30–11:30 a.m. Pacific time.

Multiple Listing Service Forum, Thursday, Nov. 11, 1–2:30 p.m. Pacific time.