BAM Key Details: 

  • Northwest MLS (NWMLS) will not opt-in to the NAR settlement for two reasons, which they broke down in a recent statement on their website. 
  • Yesterday, California Regional MLS (CRMLS) launched a new set of MLS fields, Concessions in Price (CiP), to provide up-front communication on concessions to improve communication between listing agents, buyers agents, and home buyers. 

Two major MLSs made big announcements this week. 

On Tuesday, May 28, 2024, Northwest MLS (NWMLS) published a statement on their lack of interest in opting into the NAR settlement, becoming the first non-NAR MLS to go public with its intentions. 

Putting aside the cost of opting in, NWMLS provided two reasons for going their own way. 

A day later, California Regional MLS (CRMLS) launched a new set of MLS fields, Concessions in Place (CiP), to improve communication between listing agents, buyer agents, and homebuyers. 

Both MLSs are prioritizing transparency in real estate listings, though only one is calling out the National Association of Realtors (NAR) for settlement terms that eliminate that transparency and increase risk for consumers. 

Here’s what we know so far. 

2 Reasons NWMLS will not opt-in to NAR’s settlement agreement

Putting aside the considerable cost of aligning with the NAR settlement, there are two reasons NWMLS has publicly announced its decision to go its own way:

  1. NWMLS already has in place listing standards that improve compensation transparency—and has had those changes in place for several years. 
  2. The NAR settlement eliminates compensation transparency for buyers and limits sellers’ choice by banning offers of compensation from MLSs that opt-in to the agreement. 

Essentially, the NWMLS is saying it’s already ahead of the game in improving compensation transparency and protecting the seller’s right to make offers of compensation that are easily accessible to buyer agents. 

There’s nothing NAR is doing that NWMLS can’t do on its own or isn’t already doing—and without compromising transparency by removing all compensation offers from the MLS.

It believes forcing offers of compensation off the MLS makes that information more difficult to find and not readily available for buyers and brokers. It could also lead to secret negotiations that can compromise the best interests of consumers—especially those least familiar with the process.

The NWMLS argues, “That change is a step in the wrong direction and is detrimental to consumers and brokers alike.” 

Michael Ketchmark, lead attorney for the plaintiffs in Sitzer/Burnett, is not surprised by NWMLS deciding to do its own thing, but he has some reservations, which he shared with Inman

Time will tell how the new NWMLS rules benefit home sellers compared to the NAR settlement. But as a rule, I am always suspicious when the fox says it is guarding the chicken house, and that is what is happening now in Washington.

Michael Ketchmark

Lead counsel for the plaintiffs in Sitzer/Burnett

Opting into the NAR settlement would cost NWMLS $3.31 million—the amount equal to 100 multiplied by the number of NWMLS members in calendar year 2003 (33,121). That or the second option (participating in non-binding mediation at the MLS’s cost) is the price of shielding itself from commission lawsuits against NAR, real estate brokerages, and MLSs. 

According to president and CEO Justin Haag, NWMLS is not concerned that its decision not to opt-in to the NAR settlement will leave it vulnerable to costly litigation. 

NWMLS has been directly addressing opportunities to better serve consumers with industry-leading changes since 2019. The proposed settlement agreement largely duplicates rules and practices that have been in place in NWMLS’s service area for years.

NWMLS expects the future will afford more opportunities for innovation that will benefit both brokers and consumers. For these and other reasons, NWMLS has decided not to participate in a settlement that removes transparency and consumer choice. Instead, NWMLS has elected to maintain its independence and ability to continue to innovate unimpaired by the limitations imposed by the settlement agreement.

Justin Haag

NWMLS President and CEO

The NWMLS statement also introduces plans for new revisions to its forms and listing process in mid-August 2024: 

“Instead of restricting consumer choice, NWMLS has seized every opportunity to enhance the quality of real estate brokerage services in the Northwest and will continue to do so. 

“Accordingly, NWMLS plans to revise its forms and listing process in mid-August to ensure that sellers are aware of an option that currently exists when listing a property for sale. In some instances, a seller may be prepared to pay compensation to a buyer broker, but may not be willing to offer a specific amount of compensation when listing the seller’s property for sale. A seller may instead ask that the buyer include any requested amount of compensation payable to the buyer broker in the buyer’s offer. The seller can agree to that amount or negotiate, just like any other term of the agreement.”

CRMLS provides new “Concessions in Price” (CiP) fields

NWMLS isn’t the only major MLS taking measures to improve transparency and communication. But in the case of California Regional MLS (CRMLS), those efforts center around yesterday’s launch of a new set of MLS fields. 

The goal of the new Concessions in Price (CiP) fields is to provide up-front communication on concessions to improve communication and transparency between listing agents, buyer agents, and homebuyers. 

For context, in 2023, almost 40% of the closed listings on CRMLS included concessions—payments a seller agreed to put toward the buyer’s expenses and other buyer costs pertaining to the transaction. 

Historically, concessions were included only in closed listings. 

The new Concessions in Place (CiP) fields will allow seller agents to provide concession information when adding a listing—making it easier for them to market their seller’s home and giving buyer agents a clearer idea of the buyer’s financial options. 

We’re always looking for ways to improve user experience, and, considering the fact that data shows an extensive use of concessions in CRMLS’s Closed listings, these new Concessions in Price fields at the listing level seemed like no-brainers. By providing new fields that clearly specify a seller’s willingness to consider concessions, we can better foster communication between all our users to make finding the right property that much easier.

Art Carter