I have not been a shrinking violet when it comes to expressing concerns around the proliferation of private listing networks across the country. Over the past few years, more and more inventory has disappeared from public view and turned into gated content, leaving consumers and real estate agents wondering what they are missing. Make no mistake, the concept of off-market listings is nothing new. In fact, when I began my real estate career over two decades ago, we didn’t have the technology or networks in place to share information. All listings were closely guarded by agents and brokerages - and those of you in this industry long enough will remember how inefficient that system was.
Now the technology to level the information gaps between buyers, sellers, and agents is here by way of the MLS, brokerage websites, and listings portals, but some of the biggest brands in the real estate industry are currently advocating to bring us back into the days where market transparency was a pipe dream. Moreover, we are in an affordability crisis where Americans can no longer afford to buy their first home. Mortgage rates are one thing, but we have a huge deficit of housing inventory in this country which is largely exacerbated by the nation’s biggest real estate brokerage hiding listings under the veil of a private listing network. Talk about adding fuel to the fire: this should ignite every single consumer, agent and politician to speak out against private listing networks as if their lives depended on it.
Controlling who can and cannot see what homes are on the market is a game that nobody wins. Sellers, unless fully informed about the pitfalls of listing privately, are sacrificing competition and a true auction for their homes. We as real estate professionals are now increasingly being forced to have our seller clients sign off on disclosures admitting that these practices likely yield fewer offers and less money. For our buyer clients, they are being told that they don’t deserve to know days on market or price history, because it gives them too much leverage over the sellers. A free market requires all parties to have good information so that prices are fair and trade works well. Selective distribution and hiding facts like the passage of time is what many would consider market manipulation - and agents are on the front lines.
Congress, Senators, State Attorneys General, Consumer Protection Agencies, and Civil Rights Groups are all sounding the alarm about the dangers of private listing networks on such a massive scale, yet some brokerages are defending them under the guise of seller choice - a choice that has always existed without a branding exercise and congressional scrutiny.
Private listings are now heading toward phased marketing, where properties sit in a grey area of being for sale but not technically on “the market.” Sorry to break it to you, but if homes are for sale, then they are on the market. The rest is just semantics which only further erodes trust for our profession.
If nothing else, the private listing controversy, including double-ending deals and all of the pre-marketing jargon, has only served to thoroughly confuse the consumer. As fiduciaries, agents are supposed to put our clients’ interests above our own, not to serve the bottom line of a brokerage growth strategy.
Buyers and sellers should work with agents because they want to, not because they are compelled to by a system that makes it harder on every conceivable level to obtain information. We are in the service industry, not the gatekeeping industry – so let’s be true fiduciaries and act like it.
