“Expanding choice means that NAR is still not letting homeowners choose precisely how to market their homes, but this is a small step in the right direction,” Reffkin wrote in an email to HousingWire in late March. “MLSs shouldn’t restrict how homeowners market their homes at all, but by providing them with a longer period of unrestricted public marketing, like 30 days, MLSs reduce their legal risk and homeowners gain more choice that they need and deserve.”
In the ensuing weeks, the real estate industry has wondered what Compass’ next move would be, as NAR gave the discretion of what exactly the policy would look like and how it would be implemented to the MLSs. But now the industry has its answer.
Over a week ago, Compass and Reffkin sent a letter to MLS executives asking them to not include delayed marketing exempt listings, which were created by the MLOS policy, in virtual office website (VOW) data feeds.
In it, first reported by Rob Hahn in his Substack NotoriousROB newsletter, Reffkin claims that NAR’s new delayed marketing policy “fails to provide sellers more choice given mandatory inclusion in VOW.”
“It is now on each MLS to take action to provide sufficient flexibility for sellers and reduce legal risk for MLSs,” the letter states. “By mandating that Delayed Marketing Exempt Listings be shared via a VOW feed, NAR’s new policy provides no real choice or flexibility.”
Reffkin adds that the mandatory inclusion in VOW feeds prevents sellers from choosing where their property is marketed, as any broker with a VOW feed will be able to display delayed listings on their site.
“As a result, any listing in Delayed Marketing Exempt status will be widely available to the public on nearly every real estate website,” the letter states. “The only change is that consumers will need to be logged-in to those sites.”
By including delayed listings in VOW feeds, Reffkin claims that sellers are unable to pre-market their properties and test sale prices without accumulating days on market and trading the property’s price history, as NAR’s VOW policy prevents MLSs from choosing which elements of a listing can be displayed on a VOW feed.
Due to NAR’s VOW policy and the MLSs desire to comply with NAR’s new Multiple Listing Options for Sellers policy, Compass is asking the MLSs to create an “entirely separate and distinct MLS status, such as an MLS Coming Soon status.”
Reffkin and Compass are proposing that under a coming soon status, listings would be shared only with “actively-endeavoring participants via a non-VOW broker back office feed for internal agent use only,” that there would be no restrictions on how the listing broker publicly marketed the property, including for allowing showings, and that days on market and price changes would not be tracked. They are also proposing that there be no restriction on how long a listing can remain in a coming soon status, but would be fine with a minimum of 21 days.
“Without these mechanisms, we believe more listings will end up off-MLS across brokerages,” the letter states. “In addition, MLSs will not be mitigating the legal risk of restricting seller choice, which is now heightened because of NAR’s new policy that delegates decision making to MLSs.”
In a post shared on social media, Reffkin claimed that nationwide his firm has 22,273 listings that are currently only available to be seen on Compass.com. However, if these properties are entered into the MLS as delayed marketing exempt listings, according to NAR’s FAQs on its MLOS policy, these listings are to be included in VOW feeds and available to be displayed by MLS participants who operated a VOW site. Delayed listings will not be included in internet data exchange (IDX) feeds.
A MLS participant’s ability to display another brokerage’s listings on its own VOW site stems from a 2008 settlement between the Department of Justice and NAR. Prior to 2008 NAR’s rules allowed listing brokerages to opt-out of allowing another brokerage to display their listings on its website. Additionally, the listing brokerages were allowed to limit what information could be shared on these websites.
In 2005, the DOJ filed a lawsuit against NAR claiming that these policies were anticompetitive and harming the upcoming cohort of discount brokerages who were using the internet to provide low-cost brokerage services.
In its 2008 settlement, NAR agreed that all MLSs would “repeal any locally adopted rules implementing the previous VOW or ILD (Internet Listing Display) policy,” and that NAR would certify the “adoption of the agreed upon new NAR model VOW rules.”
The adoption of this policy meant that a consumer could gain access to the MLS via a brokerage’s virtual office the same way they could at a brokerage’s physical office looking through an old-fashioned MLS binder or magazine.
If MLSs decide to create an “entirely separate and distinct MLS status,” as they are urged to by Compass and Reffkin, they would be going against this settlement, as all of the information a broker is able to provide a consumer about a listing via hand delivery, mail, fax or email, they must be allowed to provide via their virtual office site.
The only things not shared via VOW feed are those marked as “confidential” within the MLS. This includes things like expired, withdrawn or pending listings, the compensation offered to other MLS participants, the type of listing agreement used, the seller or occupant’s name and contact information, or any instructions for cooperating brokers, which may include information like codes or a security gate or alarm system.
While the settlement expired in 2018, it was codified by NAR through its VOW Policy, and with the real estate industry already under scrutiny from the DOJ, it would be surprising if an MLS decided to adopt a policy very similar to one already viewed as anticompetitive by the DOJ.
When NAR initially published its MLOS policy, many postulated that if a large number of consumers opted to use a delayed marketing tactic, it would potentially be harmful to sites like Zillow or Homes.com, which populate their sites via IDX feeds. However, as a licensed brokerage, listing portals like Zillow would have the option to swap over to VOW feeds, which would include all of the delayed listings.
Although this is a path some thought listing portals may go down, Zillow made it clear that it is pursuing another path. The company announced on Thursday that through its adoption of a set of listing standards, it would not be displaying any delayed marketing exempt listings or office exclusive listings on its site. According to Zillow, if a listing is publicly marketed to any buyer it must be put in an MLS and be able to be published on Zillow as well as other sites that receive IDX feeds.
If an MLS adopts Compass’ coming soon status proposal, this would mean that a listing marketed in this coming soon status would be ineligible to be listed on Zillow once it went fully active. eXp Realty, which has been a staunch supporter of NAR’s Clear Cooperation Policy, was the first brokerage to sign on to Zillow’s listing standards. NextHome, led by James Dwiggins and Keith Robertson, also announced they support Zillow’s listing standards.