Key Details:
- According to an October 3 email from the CEO, Jamie Johnson, the Park City Board of Realtors (PCBR) has decided not to enforce NAR’s Clear Cooperation Policy.
- The decision followed a letter sent by Johnson to the National Association of Realtors (NAR), citing concerns about potential litigation related to the policy.
- The Park City Board and MLS serve a luxury real estate community, with a higher-than-average share of sellers with a preference for keeping their homes off the MLS.
What do you tell a seller who wants to keep their multi-million dollar home off the MLS?
Since the National Association of Realtors (NAR) made it official policy for Realtors in 2020, Clear Cooperation has required all listing agents to submit listings to the MLS within one business day of marketing it publicly.
That has led to conflicts between brokers and sellers (particularly those in luxury markets) who, for valid reasons, want to keep their properties off the MLS.
For that reason, an increasing number of real estate professionals and brokerages have been pushing back against the rule, due to the risk of antitrust lawsuits—especially given the fallout from Sitzer/Burnett and the NAR settlement—and increased scrutiny from the DOJ.
And now, one local Realtor association will no longer require agents to follow the Clear Cooperation Policy. Inman first reported on the story; read on for highlights.
Seller Rights vs. NAR Policy
Agents across the U.S. are calling out the rule for limiting the rights of sellers to market their homes as they choose, even when it means limiting the number of buyers able to see them.
The Park City Board of Realtors (PCBR) serves a wealthy Utah community with a median home price of $1.7 million as of Q2 2024. Sellers of high-end properties are more likely than sellers of median-priced homes to want a more exclusive marketing approach—designed to attract their ideal buyer. And while the MLS is still the best option for most sellers, a growing number of industry voices are arguing that the seller should not be forced to use it.
As of this month, the Park City Board of Realtors is on record as saying, “We won’t enforce the rule.” It’s worth noting here, too, that while PCBR is officially no longer enforcing the Clear Cooperation Policy, they have rarely penalized agents for not complying with the rule in the past. In cases where one agent reported another for violating the policy, the board would typically resolve the violation by contacting the agent directly.
As clarified by PCBR CEO Jamie Johnson, agents affiliated with the Park City Board of Realtors are still required to list properties in the MLS unless they have a signed “right to withhold” form provided by the seller.
At the end of 2023, PCBR’s Multiple Listing Service (MLS) had 1,789 subscribers.
The Clear Cooperation Policy is also under increased scrutiny from the U.S. Department of Justice, which is already investigating NAR for antitrust violations—another reason brokerages and boards are rethinking their commitment to enforcing it.
Broader Industry Criticism of CCP and NAR Policies
Park City Board of Realtors is not alone in its opposition to the Clear Cooperation Policy.
Industry leaders and brokerages across the U.S. are speaking out against the rule, with some even threatening NAR with legal action.
For one, Thomas Wright, CEO of Summit Sotheby’s International Realty in Park City, openly supports PCBR’s decision, arguing that Clear Cooperation goes against consumer interests by enforcing a “one size fits all” approach to listing and marketing their homes.
We hope that this step forward is a sign of changes to come with the Park City Board and the industry.
No one is arguing that listing on the MLS is best for most sellers; the point of conflict is NAR’s decision to impose that on every seller whose home is marketed in any way defined as “public.”
Wright argues the CCP was designed to “level the playing field” for weaker brokerages rather than to empower brokerages to tailor their services to consumer needs. Wright sees the NAR policy as self-serving and unnecessarily restrictive of consumer choice. Requiring all properties to be listed on board-controlled MLS systems benefits the MLSs and the boards controlling them. It does not always benefit the seller.
As another example of restrictive practices in the industry, Wright brought up outdated keybox policies that prevent competition from agents not affiliated with the local board.
Other leaders in the luxury real estate sector, including Compass CEO Robert Reffkin and The Agency’s Mauricio Umansky, have openly declared their opposition to the Clear Cooperation rule, saying it harms high-end consumers who prefer more private transactions.
The American Real Estate Association, the new trade association founded by Umansky and New York Compass agent Jason Haber, is pushing for a repeal of the Clear Cooperation Policy and gathering agent signatures with an online petition. As Haber told Real Estate News, the petition itself represents “zero legal challenge” to NAR or other CCP enforcers; its purpose is to determine how many “were harmed by the Clear Cooperation Policy.”
Haber also clarified that his trade group (AREA) is not collaborating with Reffkin’s and others’ broader effort to take down the CCP.
The Top Agent Network (TAN), a private listing service, has also filed an amended complaint earlier this month in its lawsuit against NAR and the CCP, though the current filing focuses solely on NAR’s role in enforcing the policy.
Supporters and Alternatives to CCP
Meanwhile, on the other side of the debate, Zillow President Susan Daimler has reaffirmed her company’s firm support of the Clear Cooperation policy, even going so far as to criticize private listing networks (PLNs) as “anti-consumer.”
Redfin CEO Glenn Kelman and NextHome CEO James Diwggins have also spoken in support of the policy, while legal experts like Brian Schneider have suggested that repealing the policy could lead to “unintended consequences.”
Some MLSs have found a middle ground by developing alternative approaches to handle exclusive listings. Aiming to balance transparency with respect for privacy, Bright MLS allows listings to stay off public listing sites while still requiring them to be submitted to the MLS,
NAR’s Response and Potential Policy Revisions
In response to PCBR’s decision and concerns raised by others in the industry, a NAR spokesperson stated that NAR is gathering feedback from industry leaders and is open to ongoing discussions with the aim of supporting both NAR members and consumers.
That said, NAR leadership is keeping internal discussions private while considering potential changes to the policy.
NAR’s MLS Technology and Emerging Issues Advisory Board will discuss potential changes to Clear Cooperation in late October 2024.
As far as the PCBR is concerned, NAR’s response is, “Our MLS policy process is designed to weigh the varied perspectives of our stakeholders and ensure an outcome that is in the best interest of our members and consumers.”
Stay tuned as we learn more.
