A policy change by a local Realtor association-owned multiple listing service, which prevents the posting of exclusive agency listings on major home-search site Realtor.com and some other Web sites, has riled one broker whose business has relied on this type of listing.
In an exclusive agency listing, a property owner gives the broker the exclusive right to list the property for sale but the owner also can choose to sell the home alone.
The MLS policy change, which was approved by the Monmouth-Ocean MLS committee and board of directors in New Jersey, provides that “exclusive agency listings no longer be available on the public sites or the IDX sites,” which includes Realtor.com, MoMLS.com and MonmouthOceanMLS.com.
Exclusive agency listings are still available for agents to view, and real estate brokerages are free to display their exclusive agency listings on their own Web sites. The MLS has about 9,400 members.
Derek Eisenberg, president and founder of Continental Real Estate in Hackensack, N.J., and a partner in Broker Direct MLS, a flat-fee MLS listing service network, said the policy change forced him to restructure his operations, and affected some of his clients’ property listings.
He also said he questions whether the policy has antitrust implications, as a decline in the number of exclusive agency listings could potentially lead to a rise in the average price of selling a home by discouraging listings that tend to have lower-than-average commission rates.
“Exclusive agency listing is something guaranteed – it’s carved out in the real estate code that owners have a right to,” Eisenberg said, adding that the policy change could potentially “tie the hands of the public” by restricting the types of listings that they can view.
“I maintain it’s antitrust. The brokers are going to say that they’re doing it to avoid clients circumventing them and going directly to the owner,” Eisenberg said. In the end, the policy change could lead to a greater number of exclusive-right-to-sell listings, in which owners are bound to work with a broker and are not entitled to sell a home themselves, he added.
Eisenberg said that real estate agents can protect themselves from losing clients to for-sale-by-owner listings by signing agreements with prospective buyers that require buyers to work exclusively with them in the purchase of a home.
Restrictions on exclusive agency listings are not unique to the Monmouth-Ocean MLS, Eisenberg said, and there are reports of other markets in which these listings are restricted in some form.
Mindy North, president of the Monmouth County Association of Realtors, which owns the Monmouth-Ocean MLS, said the policy is intended to resolve conflicts related to exclusive agency listings.
“There were conflicts that were being brought to our attention,” North said. “Agents were having issues and asked us to review those policies.” She said the issue raised was that exclusive agency listings could potentially cause confusion for prospective buyers who saw that the same home listed for sale through a Realtor was also available for sale by the owner.
Inman Blog: Industry pros give their take on everything from home ownership, foreclosures, mortgages and real estate life to the weather, our economy, and politics. Check in daily to get the scoop.
“It is awkward when a person shows up in front of that house and also sees it’s for sale by owner,” North said. MLS leadership, she added, “thought it was best to remove (exclusive agency listings) from the public Web sites. (They decided) maybe this is something at this time that we should not be promoting. The board promotes the services of the Realtor organization.”
Allowing exclusive agency listings in the association-owned MLS “seems to be in conflict with also giving the public homes that are for sale by owner,” North said.
Eisenberg said he received “no notification” about the policy change until the change took effect, and he said he has developed some “workarounds” that will help his business comply with the policy change. “My clients were harmed. This is not a good time of year to reduce exposure (to listings).”
The Monmouth-Ocean MLS committee recommended the policy change on Oct. 20, and the board of directors approved the change Oct. 27. North said she believes that the policy change became effective immediately as of Oct. 27.
Exclusive agency listings represented a “small percentage” of the overall number of listings handled by the Monmouth-Ocean MLS, North also said. On Wednesday, the policy change will be a subject of discussion at an MLS committee meeting, she said, at the request of several individuals.
***
Send tips or a Letter to the Editor to glenn@sandbox.inman.com or call (510) 658-9252, ext. 137.
