The National Association of Realtors (“NAR”) has recently embraced two new vocabulary words, “Pro-Consumer” and “Pro-Competitive.” They also created a new policy supposedly prohibiting “pocket listings.” Sayin it doesn’t it make it so.
NAR just overwhelmingly approved a policy to outlaw “pocket listings.” They’re hyping this with their new tag words that this is “pro-consumer” and “pro-competitive.” However, not only didn’t they create a policy to stop pocket listings, they created an intricate artifice to confuse the public that they had. Instead of prohibiting pocket listings, they redefined the term “pocket listings” to mean the practice of marketing properties without the MLS. In other words, MLS members who help consumers sell their houses in a way that circumvents the MLS will be fined. It is a way to force “cooperation” or payment of a buyer broker commission even when the seller doesn’t want that. Consider the independent small broker who is a reluctant member of the MLS and is hired for a small flat fee to help a seller advertise a house on Zillow. That is now against the rules and that broker will be fined and possibly kicked off the MLS. At the same time, NAR has decided to keep the really bad part of pocket listings – “Coming Soon” and “office exclusive” listings that only benefit the brokers. Those are no longer going to be called “pocket listings” however… Kinda seems like they redefined the terms “pro-consumer” and “pro-competitive” too.
Our advice for consumers:
- Stay away from big brokers – ALWAYS.
- If a Realtor proposes that you consider a “Coming Soon” or “Office Exclusive” listing, run away – FAST.
- Make sure your listing contract states that no buyer brokerage fee will be paid to anyone if there is no buyer broker. That windfall should be the sellers, not the brokers.
- Consider owner-hosted open houses instead of Realtor open houses. Realtor open houses help Realtors find buyers to buy other properties.